Philanthropic Planning


Optimizing Asset Location with Assets Earmarked for Charity

  • This client-family’s estate plan included a substantial testamentary transfer to charity.
  • Although not needed for lifestyle, the family preferred to retain lifetime access to these assets earmarked for charity in the event of unforeseen circumstances.
  • We advised the family to fund a Private Placement Variable Annuity (PPVA) with cash and allocate the funds into underlying investments that would otherwise be held in a taxable portfolio.
  • The insurance carrier did charge annual administrative fees of less than 0.35% each year, however, this was far less than the projected annual income taxes on similar investments owned in the taxable portfolio.
  • This structure enabled the assets earmarked for charity to grow tax-free within the PPVA over their joint lifetime, enhancing the ultimate charitable transfer by deferring and mitigating income taxation on the investment earnings within the PPVA.
  • While the family does not intend to access the assets contributed to the PPVA, they appreciate their ability to do so if necessary.


Family Foundation Creation and Administration

  • This family values generosity and gives regularly to various charities across the United States.
  • Colony identified various charitable vehicles (trusts, donor-advised funds, family foundations, etc.) and met with the family to discuss the various pros and cons of each.
  • A Family Foundation was determined to be their preferred way to formalize their intentions and create a legacy of giving within the multi-generational family.
  • Colony coordinated the legal process to create the Foundation and worked with the family to create a mission statement and identify key sectors of giving.
  • Colony facilitates the grant management process; including receiving grant applications, holding annual Foundation Board meetings, and distributing checks and letters for annual giving.