Everything you’ve ever wanted to know about leaving a bequest to charity
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Benjamin Franklin said it best: Nothing in this world can be said to be certain except taxes and death.
Which is probably why we spend so much time preparing for both. But when it comes to the dreaded ‘D’ word, once you’ve taken care of your loved ones in your will, did you know that you can keep supporting your favourite charity long after you’ve passed away?
By leaving just a small percentage of your estate, you can support them to continue their good works and help those who need it most.
We sat down with the Communities at Work Marketing and Communications Manager Anthony Peterson to learn about leaving a bequest to charity – including how it will help you make a positive difference in the world, long after you’re gone.
What is a bequest?
A bequest is when you intentionally give part of your estate to an organisation that you believe in or that you share similar values with. In your will you specify a percentage of your estate or nominate a figure that goes to charity when you pass away.
We don’t like to talk too much about the prospect of our eventual death but it’s one of those realities of life. When we die we can’t take everything we accumulate in life with us. A bequest is a sensible way to intentionally think about where you would like your estate to go and what legacy you would like to leave. Think about the people that you love and care for – what type of world would you like to have them grow up in?
This world is tough enough as it is, and we need a lot of kindness, altruism, and compassion. Supporting organisations that do that is an awesome thing.
Bequests can provide resources for disability programs which support teens and adults to build their life skills and learn to live independently.
What’s the difference between a bequest and a donation?
A donation can be made any time or for any reason, but a bequest is where you sit down and think ‘When I finally leave this earth, what legacy do I want to leave behind?’
The Treasury’s Retirement Income Review from 2020 said these days the majority of people die with substantial estates. Obviously, family members and even pets are looked after, but in the mix is the opportunity for people to leave something to their favourite charities. Both donations and bequests are excellent ways to leave a lasting impact on your community. So, whether you choose to make a donation or a bequest, the most important thing is that you’re giving back to your community and supporting a meaningful cause.
Why are bequests a good way to help your favourite charity?
Bequests are one of those surprising avenues of income for charities that you don’t commonly think about. When people donate to charities, they often think about donating to Christmas or Winter Appeals. Yes, those appeals are very important and useful – but they’re loose change compared to what people leave in bequests.
People can accumulate a lot of assets over their lifetime. The average residual gift in Australia is around 7% of a $660,000 estate. That’s over $46,000 – in just one donation!
Just think of all the good works a non-profit organisation can do with a few bequests like that. For instance, at our Galilee School for disadvantaged secondary school students, just one bequest can help them establish an important ongoing educational learning project. Like refurbishing the historic stone cottage on their Kambah campus into a valuable food studies learning and outdoor dining hub.
While fundraising drives like Christmas Appeals are certainly very helpful donation sources, they only raise a tiny fraction of what bequests can.
Is there a minimum amount you need to leave in a bequest?
You can leave as little as $5! It’s up you – you might have any number of charities that you want to support or that you believe in.
What do charities such as Communities at Work do with bequests?
Unless you ask that your bequest goes to a specific program, we’ll use it where the organisation needs it most. So, we may use it to support our essential food, clothing and crisis support services. Or it may go to resources for our disability or seniors programs that help our clients develop life skills or maintain independence. Or it can help fund an important educational learning project at our Galilee School or at our early learning centres. We look across the whole organisation and where we can best meet people’s needs.
Galilee School’s community partnerships are invaluable in funding critical educational projects for its disadvantaged and vulnerable young adults.
What kind of bequests can you make?
There are three types of bequests – a specific bequest, a percentage bequest, and a residual bequest. With a specific bequest you specify an exact monetary amount or asset you want to leave to a charity (like a vehicle, property, or stocks). A percentage bequest is similar – you leave a percentage of your estate rather than a set amount. A residual bequest is where you leave a share of your estate to a charity after other expenses and gifts have been handed out.
What if you don’t have a will, how can you leave a bequest?
It’s a good idea to seek professional advice about getting a will. Thankfully, we do have an online will generator on our website that has been used by hundreds of people. It’s legal and just asks a series of standard prompts – like who is important in your life, and the likely assets you want to leave. But you can have those conversations with your solicitor and family members that you trust.
If you’ve already made a will, can you add a bequest?
Yes! Wills can be changed at any time, and it’s a good idea to regularly review your will so that it accurately reflects your current wishes. If you just want to make some additions or small changes, your solicitor can help you create a Codicil.
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