TORONTO, ONTARIO — (Marketwire) — 12/27/11 — As the year winds down, BMO Harris Private Banking announced the results of a study showing that despite the years- market volatility and challenging economy, the majority (71 per cent) of Canadians donated or planned on donating the same amount or more that they did in 2010.
The study, conducted by Leger Marketing, found that in the past 12 months, Canadians gave an average of $487 to charitable organizations.
However, the report found that more than half (54 per cent) of Canadians didn-t have a strategy when donating, and instead give on an ad hoc basis.
Top reasons respondents provided for not having a strategy in place included:
“It is encouraging to see Canadians giving despite the economic environment,” said Marvi Ricker, Vice President & Managing Director of Philanthropic Services, BMO Harris Private Banking. “However, I do encourage those that donate to sit down with a financial professional and develop a giving strategy for next year that becomes part of a financial plan, including a disciplined and strategic examination of goals, objectives, interests and options.”
Ms. Ricker noted that there are two kinds of giving – charitable giving and philanthropy. Philanthropy involves a longer term commitment and a wealth management and donating strategy that is aimed at building a lasting legacy towards a specific cause. Charitable giving, on the other hand, refers to donations made on an ad hoc basis and may include a variety of causes and charities.
The report also revealed that nearly two-thirds of Canadians (61 per cent) have a good or strong understanding of how donating impacts them from a tax perspective. “Understanding the relationship between charitable giving and how this can affect your taxes is an essential step in developing a plan,” said Ms. Ricker. “While it is satisfying to see the benefits of charitable donations at work, receiving tax benefits is important as well.
“BMO and its employees have long helped support the work of United Way in key centers across North America,” added Ms. Ricker. “The United Way does an amazing job at unburdening thousands of local charities from the need to raise funds themselves. We at BMO Harris Private Banking actively recommend to our clients that they support the United Way – whether through cash donations or through the gift of securities, both of which are attractive from a tax perspective.”
Ms. Ricker provides the following tips for those thinking of developing a giving strategy:
Speak with a professional – Regardless of the amount you are going to be donating, work with a financial professional to develop a plan that includes a budget for giving. This is an important first step to a sound strategy.
Gifts of securities – Recent federal budgets have fully eliminated the capital gains tax on donations of publicly traded securities to a registered charity. These include shares, bonds and mutual funds. Donating securities is more advantageous than selling them and donating the cash proceeds because the capital gain on the donated securities is tax-free.
Consider alternative methods – Credit cards like BMO-s World Elite MasterCard, provide cardholders with the ability to donate their points to charities. Customers can use their points to make a donation to five charities:
The online survey was conducted by Leger Marketing among Canadian adults between October 24, 2011 and October 27, 2011.
Contacts:
Media Contacts:
Amanda Robinson, Toronto
416-867-3996
Sarah Bensadoun, Montreal
514-877-8224
Laurie Grant, Vancouver
604-665-7596