Meaningful Connections: How Conversations About Charitable Giving Can Elevate Your Client Relationships 

The landscape of charitable giving has undergone a significant shift in recent years. Today, the widespread coverage of major charitable gifts and the ease of making online donations have made philanthropy a topic of interest for a broader range of clients. As a result, your clients are increasingly looking to their trusted advisors – attorneys, accountants, estate planners, and financial advisors – to provide guidance on how to incorporate giving into their financial plans. 

As an advisor, you know the importance of building strong relationships with your clients. However, have you considered the untapped potential of having open and honest conversations with them about their philanthropic goals and values? By doing so, you can strengthen your relationships and create a more meaningful and mutually beneficial partnership. By understanding your clients’ passions and values, you can help them craft a giving strategy that aligns with their goals and maximizes their impact. This approach not only benefits your clients but also enhances your reputation as a trusted advisor who can provide comprehensive guidance across all aspects of their financial lives. 

Conversations That Benefit Everyone 

Among the many benefits of discussing charitable giving with your clients is that your clients will see you as an expert about local community needs and nonprofits, especially when you have a close working relationship with the philanthropic advisors at Greater Houston Community Foundation (Foundation). Your philanthropic clients want to learn how they can make a difference through their charitable activities, and they are expecting their advisors to be ready to help them structure and plan their giving. Indeed, for years, research has shown that a proactive advisor who offers options for incorporating philanthropy into financial and estate plans inspires client loyalty, even across client generations.  

This is because philanthropic planning aligns with clients’ values and goals and but also provides a sense of purpose and fulfillment. By incorporating charitable giving into their financial plans, clients can achieve their personal and family goals while also making a positive impact on the world. This can lead to a deeper sense of connection and trust with their advisors, who are seen as trusted partners in their financial and legacy journeys. 

Moreover, incorporating philanthropy into financial planning can also provide a competitive advantage for advisors. In today’s era of socially conscious investing, financial advisors who form strategic partnerships with philanthropic institutions like the Foundation can differentiate themselves from others in the industry. By offering personalized philanthropic strategies, advisors can attract new clients, retain existing ones, and build long-term relationships that transcend generations. 

Tax Strategies 

Although a no-brainer for the list, we cannot assume that tax strategies will be the only driving force for every client. After all, even if the tax savings on dollars donated reaches 35% or even 40%, your client will still wind up with less money in their pocket after making the donation than they would have if they’d never made the donation in the first place.  

Many Americans are charitable, with a strong desire to support their favorite causes. As a trusted advisor, it’s essential to be knowledgeable about the tax aspects of charitable planning. Staying up-to-date on the basics of tax deductibility is crucial, including understanding AGI limitations, the differences between public charities and private foundations, and the benefits of donating highly-appreciated assets to charity. 

The Foundation is a valuable resource for staying current on these topics, as well as more complex giving strategies. This includes bequests, Qualified Charitable Distributions from retirement accounts, gifts of real estate or illiquid assets, and more. By staying informed and knowledgeable about these topics, you can provide valuable guidance to your clients and help them achieve their philanthropic goals.  

Continue reading: The Importance of Charitable Giving In Financial and Estate Planning

Serving Clients Across Generations 

Surveys indicate that the majority of children inheriting their parents’ estates will not stay with their parents’ financial advisor. An aging client base can be extremely dangerous to an advisor’s business. Whether you are an attorney, accountant, estate planner or financial advisor, you’re certainly aware that you need to build relationships with the next generation to stand a chance of retaining the business long-term.  

Enter philanthropy. When you work with your clients on their charitable giving plans, philanthropy can be a bridge to include the clients’ children and grandchildren in the planning, thereby giving you the opportunity to build strong, multi-generational relationships. By helping your client plan an overall charitable giving strategy, including, for example, naming children and grandchildren as successor advisors to a donor advised fund at the community foundation, you’ll get to know the family dynamics as well as build relationships with other family members.  

Continue reading: What is a donor advised fund?

Options for Every Client’s Situation 

We welcome the opportunity to work with you and your clients to structure and implement their charitable giving goals. Here are just a few of the ways we can work with you : 

• Wills and trusts. A client can establish a bequest to a fund at the Foundation through a will or trust or through a beneficiary designation on a qualified retirement plan or life insurance policy. The Foundation will provide proper bequest language. 
• Retirement plan beneficiary designations. Bequests of qualified retirement plans can be extremely tax-efficient. Funds flowing directly to a client’s fund at the Foundation from a retirement plan after the client’s death will not be subject to income tax or estate tax. 
• Family philanthropy. Consider encouraging clients to involve their children and grandchildren in philanthropy, especially when the clients are working with the community foundation through a family donor advised fund or another collaborative vehicle. The Foundation’s Next Gen Donor Institute and Family Giving Circle are powerful resources to help families engage the next generation in their philanthropic efforts. 
• Income tax planning. Remind clients that they are eligible for an income tax deduction for lifetime charitable gifts, and the gifted assets are no longer subject to future estate taxes.  
• Complex giving. Consider more sophisticated giving through noncash gifts such as closely-held stock, real estate, and business interests.  The Foundation can work with you to establish these structures through various charitable giving vehicles to help facilitate your clients’ giving goals and meet the client’s financial and tax goals.

The Community Foundation Advantage 

Many advisors take philanthropy seriously, adopting a disciplined approach and believing that it is their responsibility to understand their clients’ charitable goals and implement them to the best of their abilities using the best tools available in the market. This is frequently the reason so many advisors turn to Greater Houston Community Foundation for assistance as they serve their charitable clients, whether that assistance is behind the scenes or working together with the client.   

Advisors frequently comment that they’re surprised to discover the many ways Greater Houston Community Foundation can help their clients, especially compared with national donor advised fund programs affiliated with brokerage houses or financial services firms.  

Sometimes the greatest needs really are right here at home, and working with the community foundation is often the very best option for ensuring that your clients are informed and impactful philanthropists. Our team of philanthropic advisors work with local nonprofits to thoroughly understand how organizations are meeting community needs.  

In addition, the Foundation is unparalleled in its ability to be flexible and responsive, providing outstanding, personal service designed around your clients’ needs while always respecting your role as your client’s primary advisor.

Your Trusted Partner

The Foundation’s purpose is to serve philanthropic individuals and families, businesses, and foundations, to maximize positive impact in communities. The Foundation considers itself the ‘philanthropic arm’ of your firm, dedicated to helping your philanthropic clients maximize their positive impact in the communities they care most about. 

By partnering with our Foundation, you’ll gain access to a wealth of knowledge and resources that can help you build stronger relationships with your clients and provide them with the confidence they need to make a positive impact. Together, we can create a brighter future for all. 

Ready to learn more about how the Foundation can support your clients’ philanthropic efforts? Contact Andrea Mayes today and discover how our expertise can help you make a meaningful difference in the lives of those around us. 

Additional Resources: 

• Learn more about our Foundation’s services and how we can support your clients’ philanthropic goals 
• Join our professional advisor mailing list to stay up-to-date on the latest news and insights from the Foundation 

More Helpful Articles by Greater Houston Community Foundation:

• The Future is Now: What is Next-Gen Philanthropy?
• How Do You Start a Scholarship Fund?
• How to Start a Corporate Philanthropy Program
• What is a Private Foundation?

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