Over the past few weeks a couple clients have asked me about how and when to share their family wealth and social capital plans with their children and other family members. This of course is different for each person and each family so there is no hard and fast rule. There is however some general things that all wealth creators should consider when planning for the transition to the next generation or out into community:
1. How much is enough? As Warren Buffet said, "I want to leave enough for my kids so that they will do something, but not so much that they won't do anything." Allison Maher from Family Wealth Coach calls it Knowing Your Number. What do you need to live on and your inheritors to live on to be comfortable, what do you want government to take in taxes and what do you want your community to receive."
This weekend I caught up on my reading. You know what that is like - the back issues of magazines that you have been wanting to get to, the pile of books that you bought (some because they make you feel smart, other’s because they make you smart, and still others that are brain candy) that are lying on your nightstand or on the table beside your favourite reading area.
The last week of December is the final push that charities make for year-end donations. Even with this added push, it does not mean that donors should rush into a major decision because they realize they have to get the tax credit taken care of. Strategic giving is as much about finding the right charity partner to execute on your social vision as it is about financial planning.
Here are some things to keep in mind for these end-of-year charitable transactions:
Based on some of the conversations I have been having at TheCardThat.Gives booth at Sunridge Mall and via the various social media and blog posts, there is a general consensus that the average donor doesn’t know, or understand the costs of doing the business of philanthropy.
What does it cost to end poverty in a specific city? How much should we be investing in early childhood literacy? Do we know the economic impact that domestic violence is having in a specific locale and are we spending the right amount with the right charities to address this issue?
When we talk about charity effectiveness and impact we need to look at things in the context of the problem that the charity is mandated to address. The Financial Post just released their 2015 list of effective charities - of the 86,000+ organizations they identified 25 large, national organizations that meet their grades.
Do you ever have buyers remorse? What about donor's remorse?
GivingTuesday has come and gone, we were bomarded with solitications, actively participated in sharing on Facebook and Twitter our favourite causes, volunteered at organizations and attended events celebrating philanthropy and the charitable sector.
After all of this, now what? GivingTuesday, for donors, is an opportunity to make their annual gift to their favourite charities and in many cases have the funds matched by other donors or corporations. For charities it is a way to amplify their story on a unified platform. But what happens next?
This month I am criss-crossing Western Canada leading workshops for women on strategic philanthropy and legacy planning alongside TD Private Giving Foundation. My travels have taken me from NYC where I added a few new facilitation tools into my toolkit from the 2164 organization to sold-out workshops Vancouver, Calgary, and Saskatoon. Victoria will be at the end of the month and spots are still available – www.dexterityevents.com.
Regardless of where these women reside, there is commonality between all of them. A desire to be able to sit with their families, their partners and in a couple cases, their employees, to explore what their social vision is and how to have it play out during the course of their lifetimes and afterwards.
The news lately has focused on the bad economy, growing personal debt and the downward trend toward a recession. It’s times like these that the media also focuses on the vibrancy of the charitable sector and increased demands on front-line agencies like food banks to meet the needs of newly laid-off individuals and others affected by a down market.
Here’s the thing with giving, the true philanthropy, it is non incentivized. It is a transactional response to an emotional experience. In a down economy we still have those same emotions. My observation is, that in some cases, these emotions are heightened under the constant reminder of financial insecurity. So when charities cry poverty during a down economy, my guess is that they were heading this way long-before the economy took a turn. The financial environment accelerated or exacerbated the situation.
I walked into the Co-op liquor store the other day and the woman in front of me said - “Oh you’re that woman who works with philanthropists.” I smiled, laughed, and confirmed her statement. I then asked how she knew who I was and she mentioned she heard me speak at an AFP conference a couple of years ago. When she left the cashier, a man in his late 50’s, turned to me and said, “I don’t think I have ever met a philanthropist before.” That made me laugh. I have previously written about who is a philanthropist and the mindset hasn’t shifted much.
It is for this reason that I created myPlace2Give. A site dedicated to creating your own personalized micro-foundation. You get to pick the charities, set the disbursement amounts and the timelines, share with your friends and we take care of all the reporting. Why did we do this? Because anyone can have their own foundation, you don’t need to have millions of dollars to create meaningful impact in the world.