Making Your Mark with a Gift of Registered Funds

By Joan Cosby |

Petrel Point Ontario
Petrel Point Nature Reserve

Life doesn’t have to end with death and taxes. You can make a lasting mark in the world and it’s not complicated. In a few short minutes, you can make the decision to help your community and influence others to do the same. 

Many of us have RRSPs, RRIFs and TFSAs.  One benefit of these accounts is the option of naming one or more beneficiaries.  Funds get paid out directly and quickly to the named individuals or charities.  

My friend, Vida, was a teacher with a passion for nature, and a desire to instil that passion in the next generation.  Vida named the charity, Ontario Nature, as the beneficiary of her RRIF.  Part of her gift was used to enhance and protect Petrel Point Nature Reserve, 33 hectares of rare habitat described as a garden of wildflowers.  In celebration of Vida’s life and passion, we gather there together every spring, when her beloved orchids are in bloom.  Her gift continues to inspire others. Vida really left her mark and continues to live on.

How does giving via RRSPs or RRIFs work?

You probably need your RRSPs and RRIFs to fund your retirement. The good news is you are not giving anything up now when you name a charity as beneficiary on your RRSP or RRIF.  You retain full control of what you need for retirement, whatever is left over after you pass goes to your loved ones and chosen charities.

What are the benefits?

Many Canadians are surprised to learn their final tax bill may be almost half of their final year’s income.  That is a sizable sum that you can, with proper planning, direct to the causes that matter most to you.

In fact, naming charities as beneficiaries of your registered accounts could result in a big charitable tax credit on your final tax return.  I’ve seen situations where tax credits were left over to apply to the previous year’s return.  Imagine your estate getting a refund of taxes you’ve already paid! 

Naming charities as beneficiaries of your RRSP and RRIFs is also very easy to do. If you are a do-it-yourselfer, and you know that you want to move forward with this plan, the next step is to call your RRSP plan provider and request a change of beneficiary form.  When completing the form, include the full name of your charity along with their charitable registration number.  You can get this number from your favourite charities or from their website.

If you are not sure that this solution is right for you, ask your financial advisor. They can help you come to a decision that best suits your personal financial situation. If you don’t have an advisor, you can find one right here.  Or you can always reach me at jcosby@assante.com, I’d be happy to help.  

Next time you head out to the Saugeen Bruce Peninsula, be sure to stop by Petrel Point.  Take a few moments to experience Vida’s gift to all of us.  You can see for yourself the impact one person can have just by naming a charity as a beneficiary on their RRSP.  

While you are there, why not think about the possibilities of what could be accomplished by your favourite charity when you no longer need your RRSP.  Like Vida, you can choose to make a lasting mark and live on. 

About the Author

Joan Cosby, CFP

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