What are bequests and endowments?
A Bequest is a gift made through a will.
An endowment is a sum (usually in the form of a bequest) that is invested so that the capital is not spent , but it generates an annual income stream.
Direct donations are often spent immediately, so are then gone and possibly forgotten. A donation via the Aoraki Foundation goes on giving forever, rather than just being a one off. Donations stay in South Canterbury.
Why would I give via the Aoraki Foundation instead of giving directly to a charity?
How can I leave a gift in my will?
Your lawyer can help you and we recommend that you seek professional advice. A simple document can be downloaded from our website giving you guidelines on how to create a bequest in your will.
We always advocate to consider, and look after your family first. We also advise any donor to talk with family about their philanthropic plans for the community.
Family are often very supportive of a portion of an estate going to their community especially if they themselves have benefited from a good start to life in South Canterbury. Children of our donors often tell us how proud they to see South Canterbury be a better place as a result of their parent’s generosity.
Why would I not leave all my wealth to my children?
There is no compulsory set up fee for an endowment fund with the Aoraki Foundation, however we suggest a voluntary donation of $3,000 to cover the initial costs of establishing a named fund. Aoraki Foundation receives up to administration fee to cover overheads and operating costs. At present this is set to a maximum of 1.5% p.a. of the value of the fund. This rate is a fraction of the costs that would be incurred establishing a private fund outside of a Community Foundation.
How much does it cost to set up an endowment fund?
Distributions will vary depending on the nature and the purpose of the fund. In general the Aoraki Foundation aims to distribute between 3% and 5% of the value of the fund each year depending on the investment return.
How much will the annual distributions be from my fund?
The Trust Deed stipulates that the on-going governance of the Aoraki Foundation is subject to strict criteria. Three of the nine trustees are appointed by the region’s Mayors. Two must have legal and/or accountancy expertise and one is appointed with consulation from Te Whatu Ora South Canterbury.
All funds are invested with reputable national investment companies – Forsyth Barr and Craigs Investment Partners. A dedicated investment committee ensures these investments are in the best interest of the community. The Foundation’s Statement of Investment Policy & Objectives (SIPO) is available on request.
How can I be assured that my gift will be taken care of?
Establishing a fund with the Aoraki Foundation avoids many of the set up fees and ongoing costs of privately managed funds.
With the Aoraki Foundation there will be guaranteed perpetual trusteeships to manage the fund after the donor and the donor’s advisers have passed on.
There are the obvious economies of scale (as all the Foundation’s funds are invested together), which lead to savings in administration and fees, meaning more money for your intended recipients.
Why would I not set up my own charitable trust instead of a fund with the Aoraki Foundation?
You may choose to give just a little every year, working towards a “named fund” either during your lifetime or beyond. In the meantime, what you have donated will earn interest and make a difference through general distributions.