When people think about leaving a gift to charity, they often picture a bequest in a Will. That’s a wonderful option—but it’s not the only way to create a lasting impact.
One simple and often overlooked approach is naming Big Brothers and Big Sisters of the Fraser Valley as a beneficiary on certain assets, such as an RRSP/RRIF, TFSA, or life insurance policy. For many donors, this is an easy step to take—and in some cases, it can be a tax-smart way to give.
RRSPs and RRIFs can create a significant tax bill at death because they are generally treated as income on the final tax return (unless they roll to an eligible spouse/common-law partner or certain dependents). By naming a registered charity as beneficiary, the estate may receive a charitable donation tax receipt that can help offset taxes, meaning more of your hard-earned savings can support the causes you care about.
TFSAs are different—there typically isn’t the same tax hit at death—but they can still be a clean and direct way to give. Naming a charity as a beneficiary can be a simple way to include charitable impact in your estate plan while preserving other assets for your family.
Life insurance can be another powerful legacy tool. It may allow you to make a significant future gift at a manageable cost today, and depending on how the policy is structured, there may be tax benefits through a charitable receipt.
A few reminders: beneficiary designations can override your Will for those assets, so it’s important to keep your plan aligned. Your professional advisor can help you confirm what’s best for your situation.
Professional note: This information is shared for general purposes only. I’m not a financial advisor, accountant, or lawyer, and any strategy discussed here should be reviewed with your professional advisor.
To learn more about leaving a legacy gift to Big Brothers Big Sisters of the Fraser Valley, please contact: legacy.fraservalley@bigbrothersbigsisters.ca