Charitable giving is an essential aspect of many people’s financial lives. Some give through established channels, such as by donating to charities or volunteer work, others may give informally to family members on a regular but less structured basis – and some simply aspire to “do more”. Yet, despite the important role that charitable giving can play, studies show that many advisors hesitate to bring up the topic with clients. Advisors may worry about overstepping boundaries or feel uncertain about a client’s interest in philanthropy. However, advisors play a critical role in helping clients navigate the complex landscape of charitable giving. By integrating philanthropic planning into their services, advisors can add significant value to client relationships and provide more holistic planning.
In this guest post, Kathleen Rehl, a “reFired” financial planner and educator in philanthropic planning, shares insights, thought-provoking questions, and sample scenarios to help advisors begin and navigate charitable giving conversations, reducing any risk of awkwardness or overstepping.
Introducing the subject of charitable giving may feel daunting. However, with a few thoughtful approaches, these conversations can feel more natural and rewarding for both client and advisors. They can ease into the discussion by normalizing it – such as sharing their own giving experiences like donating a portion of their income or supporting local charities. Open-ended questions, like asking what legacy a client wishes to leave, can also allow the client to share their vision. From there, advisors can offer their technical expertise on strategies and options that a client may not have considered. Resources like handouts or educational videos can also be helpful tools to inform clients – often, many people are simply unaware of the range of possibilities!
Beyond these initial steps, advisors can support clients’ charitable goals in other ways, such as by vetting charities that align with their clients’ interests or educating them on various giving strategies. Advisors may also introduce tax-advantaged approaches that add value in multiple ways – for example, helping grandparents set up donor-advised funds that support future generations while creating tax benefits. Additionally, life events that change a client’s financial circumstances, such as retirement, receiving a windfall, or selling a business, can be ideal opportunities to revisit charitable giving as part of a client’s evolving financial and personal goals.
As clients and advisors get deeper into charitable conversations, it may be helpful for clients to create a personal charitable mission statement – a guiding star for their giving decisions during and beyond their lifetimes. These statements often stem from clients’ life stories and core values., passions, and most closely held causes. If clients need guidance, advisors can offer a template or list of values to help get them started. Once clarified, these values empower advisors to suggest charitable options that align closely with what matters most to the client.
Ultimately, the key point is that charitable giving conversations create a meaningful space for mutual exploration – where clients can discover and clarify their values and priorities while learning about the various options and vehicles available to support the causes they care about. By encouraging productive philanthropic conversations with clients, advisors not only help clients give with purpose but also deepen client satisfaction and trust. And when clients are enabled to support the causes closest to them, they experience the true impact of a financial plan that aligns with their personal legacy!
Leave a Reply