Helping your clients get organized: Structure is a critical step in multi-generational philanthropy

Posted on February 23, 2024


Instilling the idea of charitable giving in children and grandchildren at first blush may appear to be easy, but where do you begin and how do you make it ongoing? Wealth advisors are increasingly asked by their clients to weigh in on strategies for fostering a family’s financial values, which frequently include charitable giving traditions. 

An essential first step in creating any multi-generational philanthropy plan is to advise clients to consider organizing their charitable giving, such as through a family Donor Advised Fund at Stark Community Foundation. 

The process of organizing charitable giving itself creates much-needed clarity around the family's philanthropic purpose because, with an organized approach, it is easier for children and grandchildren to understand their parents' and grandparents' processes for making decisions about which nonprofits to support.

Consider this scenario: 

"Before we got everything organized through Stark Community Foundation, our family seemed to take a shotgun approach to charitable giving," commented the daughter of a donor who formed a family Donor Advised Fund upon the sale of a business. 

Her mother, the business owner, had underestimated the confusion: "Nearly every check I’d ever written to a charity was aligned with my commitment to supporting a healthy workforce in our community. Without a healthy workforce, my business would never have been successful. Now, though, I see that because I was not involving the rest of my family in my giving and explaining why I was supporting certain causes, it might have looked chaotic to them."

Establishing a charitable fund at Stark Community Foundation can be a very effective solution for many of your clients launching a multi-generational giving strategy. Here’s why:

  • Charitable funds offered through Stark Community Foundation are extremely flexible and can be used to engage an extended family in the process of charitable giving. Donor Advised Funds, for example, are popular because they allow your client to name children and grandchildren as successor advisors.
  • When your client organizes charitable giving through a Stark Community Foundation fund, the client can make a large transfer of cash or marketable securities that is immediately eligible for a charitable deduction. Your client then can recommend gifts to favorite charities from the fund when the time is right for them. This strategy is especially advantageous for clients who sell a business or, for another reason, experience a large influx of taxable income in a single tax year.
  • Establishing a Donor Advised Fund at Stark Community Foundation can be a much better choice for your family-oriented clients than a Donor Advised Fund offered through a brokerage firm (such as Fidelity or Schwab). That’s because, at Stark Community Foundation, your clients, and their children and grandchildren, are part of a community of giving and have opportunities to collaborate with other donors who share similar interests.
  • Finally, Stark Community Foundation’s tools and resources make it easier for families to gain deep knowledge about local nonprofits and to communicate across generations about the family’s charitable giving purpose and long-term impact.  

We welcome the opportunity to work with you and any of your philanthropic clients to establish an enduring and rewarding family philanthropy program.

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