Investing with Faith / Jolinda Moore

Beneficiary designation is an option to consider in estate planning

Few conversations stir discomfort quite like those about money and mortality.

Both topics alone can feel like emotional heavy lifting, but when they converge in the realm of estate planning, it’s no wonder so many people delay the process.

Getting your affairs in order, well before you need to, is truly a gift to your heirs.

It’s extremely stressful for surviving spouses, children and other loved ones to be faced with the emotional stress of saying goodbye. After that, they have the responsibility of picking up the financial pieces while coping with their feelings of grief. A few easy steps can make things easier for your loved ones, steps that are simple and meaningful.

Many people choose to support their favorite charities in an estate plan through a beneficiary designation. As you work with your attorney and other advisors, be sure to review the beneficiary designations on your insurance policies and retirement plans. Pay close attention to tax-deferred retirement plans such as 401(k)’s and IRAs.

Typically, you’ll name your spouse as the primary beneficiary of these accounts to provide income following your death and to comply with legal requirements. But as you and your advisors evaluate whom to name as a secondary beneficiary of these tax‑deferred accounts, consider naming the Church to fulfill your philanthropic desires.

Beneficiary designation is by far the most tax-efficient, streamlined way to make gifts to your favorite causes upon your death and establish a philanthropic legacy.

A contribution like this avoids not only estate tax, but also income tax on the retirement plan distributions. You and your advisors may determine that naming the Church—which could be your parish, an endowment within the archdiocesan Catholic Community Foundation (CCF) or the United Catholic Appeal—provides a simple and meaningful contribution.

We’ve all heard stories about the sad consequences of someone not having an estate plan or having out-of-date beneficiary designations. Estate planning documents, including wills, trusts and beneficiary designations, often turn out to represent generous acts of clear distribution and help to avoid conflict. Take time to ensure that your beneficiary designations are properly documented and up to date.

Please reach out to the CCF team as you work with your advisors on your estate plan. We are happy to review the numerous ministries of the Church to help determine which align with your philanthropic goals and share language for a beneficiary designation.

For more information, contact the CCF at ccf@archindy.org, archindy.org/CCF or 317-236-1482.
 

(Jolinda Moore is executive director of the archdiocesan Office of Stewardship and Development.) †