One of the cardinal rules for advisors who want to guide clients in their philanthropic giving is to not leave the client hanging without enough information, said Betsy Brill, co-founder of Strategic Philanthropy.
The firm, based in Chicago, specializes in working with both donors and advisors on philanthropic issues.
Advisors need to help clients think about philanthropy and define their goals, but they should also provide their clients with the information they need to help carry out their wishes, Brill said. This could involve bringing in experts from other fields, such as attorneys, or experts on the various vehicles available to philanthropists, added Jennifer Klein Strauss and Laura Malone.
Strauss is an attorney with Ytterberg Deery Knull, a law firm based in Houston that focuses on working with clients and their financial advisors on legacy and other issues. Malone is vice president of corporate and complex giving at the American Endowment Foundation based in Hudson, Ohio, The three women revealed some tips for enhancing clients’ giving experience during the Invest In Women conference in Houston this week sponsored by Financial Advisor magazine.
“Stay on your toes” and provide the guidance the client needs to actually fulfill their philanthropic goals, Brill said, adding that the philanthropic landscape changes; be ready to help clients change with it.
Advisors need to look for an opening with their clients to start the philanthropic conversation and then ask pointed questions to define their goals, Strauss said. Call on other experts when needed to fill out the details, she added.
Tax laws change, so an advisor needs to keep up with the provisions that affect giving, For instance, advisors need to be aware of such things as the sunset dates when some of the tax and estate law changes made in the recent reform will revert back to the pre-2018 law, she advised.
Primarily, people do not give just to get tax breaks, but “a tax savings your client realizes this year can mean they can give more next year, Malone said. “Return on investment planning can be used to invest in giving.” You can even use social, responsible and impact (SRI) investing to do good now, so the client can make money to do more good in the future, she added.
“Give your clients a range of philanthropic vehicles, such as check-book giving, donor advised funds, foundations and charitable remainder trusts. Don’t limit them to just one,” she advised.
Advisors are missing an opportunity in not meeting with their clients’ children, Brill warned. “Thirty trillion dollars will transfer to millenials over the next three decades, and yet more than 70 percent of advisors do not meet with their clients’ children,” she said. Millennials and women are the most active philanthropists, she added.