The Ultimate Status Symbol & Making a Difference in the World

In my latest YouTube video and podcast episode I talk about the ultimate status symbol and making a real difference in the world.

That may sound like two completely different topics, but it’s actually one topic and I’m going to show you how to do both at the same time!

Here’s what I cover:

  • What is the ultimate status symbol for the wealthy?
  • What is a “Generosity Plan”
  • What are the advantages of a personal charitable foundation?
  • What are the tax savings of a personal charitable foundation?
  • What is the difference between a public foundation and a private foundation?
  • How does a personal charitable foundation work?
  • Who can you donate to?
  • How can you know which causes make the most difference?
  • What can you donate, other than cash?
  • What are some examples of effective donations?
  • How can you make a real difference in the world?

Each group has status symbols:

  • Young – Latest smartphone
  • Low net worth – Hot car
  • Middle class – Home
  • Wealthy – Charitable foundation in their name. E.g., Bill & Melinda Gates Foundation

Picture it:

Your name Charitable Foundation” contributing to the causes most important to you and surviving 100+ years after you are gone.

Many people want to leave a legacy.

If you have been following me & have a growth outlook, you may eventually have more money than you need or want to spend.

Many people think Financial Planning is only for those that need help having the future they want. However, Financial Planning is for everyone. It is life planning. If you have way more money than you ever need, you need a life plan to decide what to do with it.

  • Enjoy life more, more travel, more entertainment, more homes?
  • Should you leave it all for your kids?
  • How can you make a real difference in the world?
  • You can be a philanthropist.

Charitable foundation benefits:

  • “Donor-Advised Fund”.
  • Get full tax credit now. Stay invested.
  • Donate 5%+/year.
  • If you donate $5,000/year, donate $100,000 now, get $50,000 tax refund, and your foundation does your donations for life.
  • Good for a high-income year.
  • Get family involved in donation committee.
  • Financial education for your kids.
  • Other people can donate to your foundation.
  • Can exist long after you are gone. Leave a legacy.
  • Confidential donations.
  • Creative investment strategies to make donation far larger.

Tax-efficient donations:

  • Registered charity #: 9 numbers + RR + 0001.
  • Non-Canadian charity – Ask about Canadian affiliate.
  • Non-refundable tax credit:
  • First $200: Lowest tax bracket 20%
  • Above $200: Highest tax bracket 50%
  • Above $200: Highest tax bracket 54% for income >$220,000
  •  Combine: Usually claim on higher income spouse.
  • Can carry forward up to 5 years.
  • Maximum 75% of net income.
  • Year of death: Maximum 100% of net income.
  • Save tax on your estate:
  • RRSP, capital gain, sale of business, rental property or cottage.

Advanced Donation Tax Strategies

  •  New “Alternative Minimum Tax” (AMT) starts in 2024. Largest target is donations.
  • Government thinks rich people avoid tax with donations.
  • People will probably donate less to avoid AMT.
  • Consider a foundation in 2023 for large donations.
  • There are better causes than paying tax to government!
  • Donate “in kind”: Stocks or mutual funds.
  • No capital gain plus tax credit.
  • Tax refund instead of paying capital gains tax.
  • Option to use flow-through share strategies to contribute up to 10 times more (future post).

“Donation Plan”

Financial Plan is the GPS for your life. Donation Plan can be the GPS for your legacy.

Decide on your causes.

Create one now:

Donate cash

Donate investments (that you may be able to still control)

Create one in your will:

  • Donate part of estate.
  • Gift of life insurance.
  • Beneficiary of registered accounts.
  • Will can be contested, but donations now cannot.

Benefits of a Donation Plan

  • Choose 1-3 causes important to you.
  • Donate a larger amount to your causes.
  • May still want to give for family or friend requests.
  • Make a difference.
  • Get a good feeling from giving back.
  • Say “no” to all telemarketers.
  • Tell them you have a Donation Plan.
  • Your charitable foundation can make all your donations

Public foundation vs Private foundation

Private foundation is a corporation or trust you create & file with CRA for charitable status.

  • You control it entirely.
  • Start-up & annual costs. Bookkeeping, knowing CRA rules, CRA & legal filings, etc.
  • Need tax advice to file CRA registration & renewals, and to know CRA regulations.
  • Donors & directors are public information.

Public foundation – Existing foundation can manage it all for you.

  • You can still fully control it.
  • Setup easily.
  • CRA filings done for you.
  • Costs probably lower, except possibly for large foundations.

How does a Personal Charitable Foundation work?

  • Contribute once and get large donation tax credit. About 50% tax refund.
  • Maximum 75% of taxable income.
  • Carry forward tax credit 5 years.
  • Invest inside foundation. They manage investments. You may be able to manage with $1 million minimum (depends on provider).
  • 5% of value must be donated every year.

In a public foundation, 5% of total foundation must be donated. Most already donate much more, since some people use it as a one-time donation and some want to donate more. Therefore, you may not have to donate 5% every year, especially the first few years.

You tell foundation provider the causes you want to donate to.

  • Can be fixed amounts or can be changed any time.
  • You determine, or setup a board of a few trusted people to decide.
  • Leave instructions for once you are gone, either who to donate to or who makes decisions after you are gone.

Registered charities must have charitable purposes:

  • the relief of poverty;
  • the advancement of education;
  • the advancement of religion; and/or,
  • other purposes that benefit the community.

Qualified donees:

  • registered charity
  • registered Canadian amateur athletic association
  • registered journalism organization
  • registered housing corporation resident in Canada constituted exclusively to provide low-cost housing for the aged
  • registered municipal or public body performing a function of government in Canada
  • registered university outside Canada, the student body of which ordinarily includes students from Canada
  • municipality
  • registered charitable organization outside Canada to which His Majesty in right of Canada has made a gift
  • United Nations and its agencies

Choose the causes most important to you:

  • Causes you care about:
  • Cause important to you personally.
  • Disease a person important to you died from.
  • Disease in your family history.
  • Map your genome. Diseases you are genetically at a higher risk.
  • Could be local or global causes.
  • E.g., Poverty.
  • Local – See the benefits.
  • Global – Make the biggest difference for humans.
  • Global – Bjorn Lomborg books “The Smartest Targets for the World” and “Best Things First”.
  • Municipality. For a specific project, like park or community centre.
  • University. For an annual scholarship  in your name.
  • Family or friend requests.
  • Research the most effective causes.

Billionaires & the “Giving Pledge”

  • Pledge to donate >50% of your estate.
  • Movement to make philanthropy standard for wealthy.
  • Intergenerational wealth vs. “unamerican” to inherit.
  • 230 signatories in 228 countries.
  • Bill & Melinda Gates.
  • Warren Buffett – Pledged 99% of his wealth.

Most effective charities or causes

Charity administration & fundraising:

Financial statements show how much is overhead.

Charity ratings:

Charity Intelligence Canada: Top 10 & 100 charity impact ratings.

Request “Impact Report: from charity.

Copenhagen Consensus: Top Nobel Laureates estimated bang for buck

Goals with 15+ times return

12 most efficient solutions for the world’s poorest & our global SDG promises (preorder Bjorn Lomborg’s new book “Best Things First”)

Governments and philanthropists should focus on these 12 smartest things:

  • Fix tuberculosis, malaria, and chronic disease
  • Tackle malnutrition
  • Improve education
  • Increase trade
  • Implement e-procurement
  • Secure land tenure

This will improve the world amazingly.

  • Cost is $35 billion a year.
  •  Benefits:
  • Save 4.2 million lives each year.
  • $1.1 trillion benefits for the world’s poor.


Planning With Ed


Ed Rempel has helped thousands of Canadians become financially secure. He is a fee-for-service financial planner, tax  accountant, expert in many tax & investment strategies, and a popular and passionate blogger.

Ed has a unique understanding of how to be successful financially based on extensive real-life experience, having written nearly 1,000 comprehensive personal financial plans.

The “Planning with Ed” experience is about your life, not just money. Your Financial Plan is the GPS for your life.

Get your plan! Become financially secure and free to live the life you want.

Leave a Comment