Five frequently asked questions about philanthropic funds
More and more people are realizing that they can support causes they care about by planning donations to organizations that do essential work. Setting up a philanthropic fund is a simple and flexible solution that allows them to take action.
However, establishing a philanthropic fund often raises a host of questions! Maxime Cossette and Éric Grondin, philanthropic advisors at the Desjardins Foundation, answer the most frequently asked ones.
1. I'm curious about the idea of a philanthropic fund, but I'm afraid it's complicated and rigid. Can I make changes over time?
Absolutely! A philanthropic fund is a way of giving that can evolve according to the donor's wishes. Many decide to change or add organizations because certain causes appeal to them more. This is an important aspect because what is a fundamental social issue today may become less crucial tomorrow. Needs change over time. Donors may also be drawn to a cause or organization they didn't know about. They can make changes to their philanthropic fund at any time, at no cost. This is one of the many advantages of using this approach: It's dynamic and it's not constraining.
2. How involved should I be with the organizations I wish to support?
That's up to donors to decide.
Some people want to keep their charity work anonymous. For all sorts of valid reasons, some wish to make a more discreet commitment, or even to keep their financial contribution to the beneficiary organization secret.
In other cases, donors prefer direct contact with the recipient organizations. They may wish to meet with them to see first-hand the services offered and the impact of their donation, or even to volunteer their time.
Beneficiary organizations can also recognize the contribution of donors who agree to have their names published, as a way to thank them.
3. I want to grow my philanthropic fund. Can I do that?
Of course. Philanthropic funds offer great flexibility. In fact, it's a good idea to include donations in your financial plan.
One third of donors choose to increase their donations over time. We're always there to support them and sometimes even help them or guide them in their thought process.
Changes can be made at any time and at no cost.
4. How can I make sure my fund continues to reflect my values over the years?
A philanthropic fund is an effective way to build or continue a family philanthropic tradition. It makes sense to name someone close to the donor to ensure the continuity of the fund, so that they in turn can ensure that the values built into the project carry on. We encourage donors to contact us to discuss their goals and modify their choices over time.
5. I'd like to leave part of my inheritance to causes that are important to me. What are the best practices for making a donation through a will?
A donation through a will is a great way to leave your values as an inheritance.
From experience, we can also say that the discussions we have with donors on this subject are often very moving. For many, it's the culmination of a lifetime. For some people, who don't have heirs, it's comforting to see that their money will benefit
organizations and causes they care about.
Before formalizing their donation in their will, individuals will need to clearly define what they want to achieve with it. We’ll work with them to determine the terms of the agreement, including how the fund will be distributed and the beneficiary organizations. This step is essential! It ensures that their wishes are respected, makes the liquidator's job easier, and limits their trips to the notary. So, it's important to make sure that both documents match.
In all cases, we're here to walk them through the process and help them make informed decisions.