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Leaving a Legacy, the Easy Way

Choosing the Cancer Support Community Valley/Ventura/Santa Barbara (CSCVVSB) as a beneficiary of a 401K or IRA is an easy way to make a huge impact – one that will leave a legacy of hope for cancer patients and their families in our community.

alan-hopkinsAlan Hopkins, Chief Economic Strategist for Manchester Financial, a past CSCVVSB board member, former board chair, and current CSCVVSB Board of Trustees member, took the time to walk us through the process.

Q: Let’s say I want to designate the Cancer Support Community as a beneficiary of my 401K or IRA. What is the first step I need to take?

A: Request a change of beneficiary form from your current custodian or plan administrator.  You can then list (or designate) CSCVVSB to receive a certainpercentage of the account.  Some custodians will allow you to designate a specific dollar amount instead of percentage.  This new designation will REPLACE your old one, so be sure to include all other beneficiaries that you still want to receive a portion of this account.

Q: Are there any costs involved in designating CSCVVSB as a beneficiary?

A: There are no costs involved, besides the cost of a stamp and the time it takes to print the form!

Q: Do I have a choice about how much or what percentage I can allot for CSCVVSB to receive?

A: You can designate any percentage (or possibly amount), and you can change this at any time. Some custodians require that these designations be in whole, one percent increments.

Q: Are there any tax-related or other advantages for the donor?

A: Yes, an IRA is the BEST way to leave money to a charity! Because a charity does not have to pay taxes on this gift, they will actually receive 100% of the amount donated from an IRA.  And remember, you also have never paid taxes on these funds.  If an individual is the beneficiary of an IRA, taxes will be owed when the money is distributed from the account, so the net effect is that they will receive something less than 100% of the amount inherited.  It is better to leave your IRA to a charity and leave other assets to your beneficiaries that are individuals.

Thanks to Alan Hopkins, Chief Economic Strategist; and Cindy Randolph, Client Relations Manager; at Manchester Financial in Westlake Village. 

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