On a fundamental level estate planning involves preparing your material assets for distribution to your loved ones after your death. But when you are taking the time to evaluate what you have accumulated throughout your lifetime and how you intend to pass it on a bigger picture sometimes emerges. Giving the money that you have left over when you pass away to your family members is simple enough, but the totality of your legacy is something that will inevitably cross your mind as you are making these financial plans.
Over the summer Bill Gates and Warren Buffett issued a challenge to the richest people in America asking that they pledge to give away most of their wealth to charity over a period of time. Buffett has given billions to the Bill and Melinda Gates Foundation over the last several years so you have to give him credit for setting a good example and not asking others to do what he himself is unwilling to do.
Though you may not have the resources to start a family foundation, your legacy can still include charitable contributions. One of the ways that people of more modest means can make a difference is through the use of donor advised funds. With these funds you can give to multiple charities through a single contribution, making them extremely efficient. You can also name an adviser to succeed you after your death in an effort to foment a family legacy of philanthropy.
Another creative way that you can make a difference with your estate plan is through the use of incentive trusts. With an incentive trust you name a beneficiary and a trustee as you would with other trusts, but you add stipulations that are intended to act as incentives. If you were to create an incentive trust that required some type of community service as a stipulation you would provide some tangible loving wisdom to accent the financial bequest while facilitating a positive difference in the world you have left behind.