Planning Options for Your Stage in Life

Embracing philanthropy in your retirement journey

In many ways, retirement planning is a science, but it's also personal. It's a journey where you can apply tried-and-true principles while also crafting a unique plan that suits your assets, priorities, and dreams. It's a future plan that can lead to making the world a better place through a meaningful charitable gift.

In other ways, though, retirement planning is an art form. Each person has a unique combination of assets, priorities, and dreams for the future. For many people, those priorities and dreams involve wanting to make the world a better place, often through meaningful personal philanthropy.

It’s never too late to think about the role philanthropy might play in your retirement plan. Let’s explore some common planning options that might prove particularly useful.

The “happily ever after” years

The goal, of course, is to live happily ever after—to realize that the years of saving and planning were successful, leaving extra flexibility to meet charitable goals. In this stage, there are unique opportunities to make an impact and shape a legacy.

Luis and Sophia have owned and enjoyed a vacation home for decades, but they are tired of the maintenance and taxes and would prefer to spend their money traveling. When they learned about the charitable remainder unitrust (CRUT), a financial tool that allows them to convert their vacation home into a welcome income stream while supporting Indiana University’s important mission, they were excited about the idea.

A CRUT pays a fixed percentage of trust assets as revalued annually, meaning the actual dollar amount fluctuates from year to year. Luis and Sophia are comfortable with this idea because they don’t plan to rely on the income for living expenses.

By using the CRUT, Luis and Sophia can manage potential capital gains tax liability, obtain a substantial income tax charitable deduction, and receive a generous income stream. But more than that, they can take pride in knowing that their gift will substantially impact IU once their payments are complete.

An easy way to make an immediate gift of retirement assets is with a qualified charitable distribution (QCD). If you are an IRA owner age 70½ or older, you can make a distribution from your IRA directly to us and pay no tax on the distributed amount (up to the annual aggregate limit of $108,000 in 2025). Plus, the distribution counts toward your required minimum distribution (RMD) if one is due (generally, age 73 or over).

There is another option as well—a one-time, tax-free IRA distribution of up to $54,000 (in 2025) to fund a new charitable gift annuity (CGA) or charitable remainder trust (CRT). This type of QCD also counts toward your RMD if one is due. Spouses can each direct up to $54,000 (in 2025) from their own IRAs into a single CGA or a joint-life CRT. With a CGA or CRT, you can receive a fixed income for life, and the remaining amount will be used for the charity once you've passed.

A final word

There are many ways to give, no matter where you are in life. Strategic planning can help you be more effective in your philanthropy. We would be pleased to help you and your advisors explore options for making an important impact in a way that fits your current situation and goals.

Tax information provided herein is not intended as tax or legal advice and cannot be relied on to avoid statutory penalties. Always check with your tax and financial advisors before implementing any gift. Contact us to get started.

All examples are for illustrative purposes. Contact us for current rates and tax information.