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Every day, images of humans in need fill the news cycle, from refugees and displaced citizens to victims of racial and gender inequality. With donation requests coming in from organizations and even friends on your Facebook feed, how can you find an efficient way to manage it all? Jo-Anne Ryan, Vice President of Philanthropic Advisory Services at TD Wealth and the Executive Director of the Private Giving Foundation, joins Kim Parlee to discuss donor-advised funds and some ways you can donate now and decide later.
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- Every day, images of people in need really do fill up the news cycle. We have heard, of course, about some of the tragedies in Afghanistan. Earthquake, hurricane victims, racial and gender inequality really taking front and center for a lot of people.
Donation requests, of course, do come in from organizations and even friends probably on your Facebook feed. But there are so many that you are interested in helping, and you want to make an impact, what's the best way to do it? Jo-Anne Ryan is Vice President of Philanthropic Advisory Services at TD Wealth, Executive Director of the Private Giving Foundation. She's here for this Ask MoneyTalk question.
Jo-Anne, the question is, when I hear about emergency causes on the news I like to give, but sometimes important causes arise when I might not have the extra money to spend. What's the most efficient way of giving when I don't know what next week's crisis will be? And as I said, Jo-Anne, it feels like there's a crisis every week right now.
- Yes, thanks for having me, Kim. And that's a great question. We are hearing a lot in the news about crises, and across the globe, really. And so one aspect or one vehicle you might want to consider is setting up a donor-advised fund, which is a simple, easy alternative to establishing your own foundation.
So for example, at TD we have the Private Giving Foundation. So rather than going to a lawyer and setting up a corporation or a trust and getting it registered with CRA, with very simple paperwork you can have a donor-advised fund set up very simply and very easily. Very basic paperwork. You name it just as you would name a foundation.
It's not always tax-driven, but many of our clients who've sold a business and have a tax liability, or they have large capital gains on a stock choose to put money into a donor-advised fund. They get the tax receipt up front, and then they can decide later how they want to allocate it. So I call them donate now, decide later.
So for example, when the global pandemic hit, clients that had a donor-advised fund were in the perfect position to help, because charities were suddenly in desperate need of money, whether it was a food bank, a shelter, a hospital foundation. And so clients that had already committed those funds to a charitable account are really well posed to be able to allocate them to organizations that can help those most in need. And you're right. I mean, literally, in the last little while we have heard the Afghanistan situation.
Many of our clients and donors have wanted to help refugees, women refugees especially from Afghanistan. And so with already funds in a charitable organization they're able to direct them immediately to organizations that are doing great work. So I think a way to be very structured and strategic around your philanthropy is to consider a donor-advised fund.
- I love what you talk about in terms of donate now, decide later. That it's such a succinct way of saying what it is. My next question though is, do you need a lot of money to start a donor-advised fund?
- No. In fact, the minimum for the Private Giving Foundation, to get it started, is only $10,000. So we've actually made the concept of having a foundation accessible to many, many people by having a very low minimum. And you can contribute to it, your family, your friends can also add to it and get the tax receipt. Very simple, and very easy to establish.
- Hm. What else should people think about when, I guess, under stress and giving to emergency aid humanitarian crises?
- Well, one of the things that has become popular are GoFundMe pages. And I would just exercise some caution if you were going that route because you don't get a donation receipt, so you don't get a tax receipt. So you don't have the same transparency that a registered charity would have in terms of making sure that the funds are actually getting to the cause. So I think if it is a registered charity with CRA, that's a bonus.
Otherwise, there are some good organizations like canadahelps.org that would have cause funds that you could donate to, and then they will allocate it to a number of different organizations that are working on a particular cause. But they will often come out when there is a disaster. They recently did with Afghanistan. And they came out with an email and saying, here are the organizations that are doing work in Afghanistan. So they've already done the due diligence on it. And then you can pick and choose and select the ones that you want to support.
- Jo-Anne, thanks very much.
- Thanks for having me, Kim.
- Jo-Anne Ryan with TD Wealth. If you have a question you'd like to ask MoneyTalk, send it in to moneytalk@td.com. Subject line, Ask MoneyTalk. Again, we'll get your question, we'll find the right person to answer, and you can find that answer on moneytalkgo.com.
[MUSIC PLAYING]
- Every day, images of people in need really do fill up the news cycle. We have heard, of course, about some of the tragedies in Afghanistan. Earthquake, hurricane victims, racial and gender inequality really taking front and center for a lot of people.
Donation requests, of course, do come in from organizations and even friends probably on your Facebook feed. But there are so many that you are interested in helping, and you want to make an impact, what's the best way to do it? Jo-Anne Ryan is Vice President of Philanthropic Advisory Services at TD Wealth, Executive Director of the Private Giving Foundation. She's here for this Ask MoneyTalk question.
Jo-Anne, the question is, when I hear about emergency causes on the news I like to give, but sometimes important causes arise when I might not have the extra money to spend. What's the most efficient way of giving when I don't know what next week's crisis will be? And as I said, Jo-Anne, it feels like there's a crisis every week right now.
- Yes, thanks for having me, Kim. And that's a great question. We are hearing a lot in the news about crises, and across the globe, really. And so one aspect or one vehicle you might want to consider is setting up a donor-advised fund, which is a simple, easy alternative to establishing your own foundation.
So for example, at TD we have the Private Giving Foundation. So rather than going to a lawyer and setting up a corporation or a trust and getting it registered with CRA, with very simple paperwork you can have a donor-advised fund set up very simply and very easily. Very basic paperwork. You name it just as you would name a foundation.
It's not always tax-driven, but many of our clients who've sold a business and have a tax liability, or they have large capital gains on a stock choose to put money into a donor-advised fund. They get the tax receipt up front, and then they can decide later how they want to allocate it. So I call them donate now, decide later.
So for example, when the global pandemic hit, clients that had a donor-advised fund were in the perfect position to help, because charities were suddenly in desperate need of money, whether it was a food bank, a shelter, a hospital foundation. And so clients that had already committed those funds to a charitable account are really well posed to be able to allocate them to organizations that can help those most in need. And you're right. I mean, literally, in the last little while we have heard the Afghanistan situation.
Many of our clients and donors have wanted to help refugees, women refugees especially from Afghanistan. And so with already funds in a charitable organization they're able to direct them immediately to organizations that are doing great work. So I think a way to be very structured and strategic around your philanthropy is to consider a donor-advised fund.
- I love what you talk about in terms of donate now, decide later. That it's such a succinct way of saying what it is. My next question though is, do you need a lot of money to start a donor-advised fund?
- No. In fact, the minimum for the Private Giving Foundation, to get it started, is only $10,000. So we've actually made the concept of having a foundation accessible to many, many people by having a very low minimum. And you can contribute to it, your family, your friends can also add to it and get the tax receipt. Very simple, and very easy to establish.
- Hm. What else should people think about when, I guess, under stress and giving to emergency aid humanitarian crises?
- Well, one of the things that has become popular are GoFundMe pages. And I would just exercise some caution if you were going that route because you don't get a donation receipt, so you don't get a tax receipt. So you don't have the same transparency that a registered charity would have in terms of making sure that the funds are actually getting to the cause. So I think if it is a registered charity with CRA, that's a bonus.
Otherwise, there are some good organizations like canadahelps.org that would have cause funds that you could donate to, and then they will allocate it to a number of different organizations that are working on a particular cause. But they will often come out when there is a disaster. They recently did with Afghanistan. And they came out with an email and saying, here are the organizations that are doing work in Afghanistan. So they've already done the due diligence on it. And then you can pick and choose and select the ones that you want to support.
- Jo-Anne, thanks very much.
- Thanks for having me, Kim.
- Jo-Anne Ryan with TD Wealth. If you have a question you'd like to ask MoneyTalk, send it in to moneytalk@td.com. Subject line, Ask MoneyTalk. Again, we'll get your question, we'll find the right person to answer, and you can find that answer on moneytalkgo.com.
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