RB

Ryan Boyd

Senior Research Analyst @ ABI Multifamily
2 karmaJoined Working (0-5 years)

Participation
1

  • Completed the Introductory EA Virtual Program

Comments
1

Regarding donating 10% of your wealth in your will, as others have said, your donations will likely be more cost-effective now versus decades down the line. Moreover, 10% of your wealth upon death can be a drastically different amount of money than 10% of your annual income. 

There are additional tax and other considerations like you’ve mentioned, but some simple math:

$60.10 * 2,080 (hours in a year assuming 40-hour work week) = $125,008 annual salary

If we assume a 3% pay increase each year, and that you work another 40 years:

Under these assumptions, a 10% pre-tax donation rate until retirement will mean you've donated $942,576, so in order to match this amount by donating 10% in your will, you would need to have an estate worth at least $9.4 million. Your savings rate, investments, and a myriad of other factors could make a 10% donation in your will a much higher or lower number, therefore you may need to allocate a significantly higher or lower percentage of your estate to match the amount from annually donating.

If you haven't found this resource yet, the 10% Pledge webpage from Giving What We Can has an FAQ section that discusses a number of the points you brought up, and I would highly recommend reviewing it.

Congratulations on your recent graduation and good luck on your journey!