At Arkansas Community Foundation, we regularly talk with retirement-age donors and fundholders about the tax benefits of directing Qualified Charitable Distributions to a designated fund, and/or leaving bequests of IRAs to a donor advised fund. But getting involved in philanthropy can be so much more than that. This is particularly relevant as some retirees consider returning to work and contemplate what that means for their charitable giving and volunteering plans.
You’ve likely heard the statistic that 10,000 people in the United States are turning 65 every day. And while 65 may be the “traditional” retirement age in this country, the milestone appears to be anything but traditional nowadays. While Covid-19 did not impact retirement ages as much as some might have predicted, many of those who did retire actually now regret it. While many retirees are seeking work for financial reasons, two of the top six reasons to go back to work involve boredom or loneliness.
For people who’ve reached a theoretical retirement age, working or returning to work provides many opportunities that tie into philanthropy. For example:
–You can still contribute to your IRAs (which many people do not realize), and if there’s an employer-sponsored 401(k) plan, all the better.
–You can use your extra income to fund your donor advised fund at the Community Foundation, making you eligible for an income tax deduction as well as removing assets from your taxable estate.