High-Net-Worth Philanthropy for HNW Individuals and Families 

When it comes to estate and financial planning, you understand the importance of tailoring a customized approach to each client’s distinct situation and goals. But what about charitable planning? Your clients deserve the same level of personalized attention and strategic guidance as they navigate their charitable giving journey.

Everyone has a unique philanthropic story, with their values, priorities, and financial circumstances influencing their approach to giving. Some may be passionate about supporting specific causes, while others may be focused on leaving a legacy through a family foundation. Whatever the case, your UHNW (ultra-high-net-worth) clients require high-net-worth philanthropic solutions as unique as they are.

At Greater Houston Community Foundation, we recognize that no two philanthropists are alike. That’s why we offer a diverse range of charitable giving strategies and services designed to meet the needs of our clients. From donor advised funds to scholarship funds, we have the tools and expertise to help your clients achieve their philanthropic goals and maximize their social impact.

What are your clients’ charitable giving needs?

Charitable giving by income level varies significantly, and UHNW individuals often have sophisticated financial structures and unique philanthropic priorities. Your high-net-worth clients likely have the following concerns:

• Maximizing tax advantages through strategic charitable contributions
• Creating lasting social impact aligned with their values
• Integrating charitable gifts into their broader estate and financial plans
• Accessing guidance from financial advisors and philanthropic experts
• Choosing the right charitable organizations and giving vehicles

At the Community Foundation, we specialize in helping financial advisors and their clients navigate these complex decisions with personalized support.

Popular fund types, benefits & considerations  

Donor advised funds

A donor advised fund (DAF) enables your client to establish a specific account for charitable giving. Your client makes tax-deductible contributions to the fund, and then recommends grants to favorite charities.

Eligible assets include: cash, publicly traded stocks, bonds, other securities, business interests, life insurance policies, real estate, and many other appreciated assets.

Tax advantages: Donors receive an immediate charitable giving tax deduction in the year of contribution, while the fund grows tax-free. This structure is particularly beneficial for UHNW individuals looking to group deductions in high-income years and maximize donor advised fund tax benefits.

Community Foundation perk: At the Community Foundation, you can continue to manage your client’s investments when they open a fund with $500,000 or more.

For more details on how DAFs work and important considerations, review our guide on donor advised fund rules.

Continue reading: What is a donor advised fund?

Unrestricted Fund

The Community Foundation has its finger on the pulse of the community’s most pressing issues. An unrestricted fund gives your client the opportunity to support community needs that can’t be identified until the future. One of the biggest benefits of the Community Foundation is its perpetual structure that allows clients and their families to offer support to nonprofits that evolves over time as priorities in the region shift.

Field-of-interest fund

Clients who want to target their giving to specific areas of community need (such as education, health, environment, or the arts) can establish a field-of-interest fund to set parameters for grantmaking under the ongoing guidance and expertise of the Community Foundation. 

Designated fund

A designated fund allows a client to direct giving to a specific nonprofit organization or purpose. Over time, the Community Foundation manages the distributions from the fund according to the terms established by your client.

Agency fund

An agency fund is like a designated fund, except in the case of an agency fund, the source of the initial contribution is the beneficiary nonprofit organization itself, not a donor(s) as is the case with a designated fund. If your client serves on boards of directors of charities, they’d likely be interested in learning more about agency funds.

Scholarship fund

Clients can establish scholarships in Houston or nationwide to support students’ educational pursuits based on the parameters and application requirements they outline with help from the experts at the Community Foundation. This is an excellent way for UHNW individuals to create a lasting legacy through education.

Continue reading: How to start a scholarship fund

Private foundations: an alternative approach

For clients with substantial wealth and long-term philanthropic goals, establishing a private foundation may be worth considering. Private foundations offer unique tax benefits and greater control over charitable giving decisions—they do, however, come with additional compliance requirements and ongoing administrative costs. Compare the private foundation tax benefits against other charitable vehicles to determine the best fit for your client’s situation.

Developing effective charitable giving strategies

Creating a successful philanthropic plan requires more than selecting a fund type. Financial advisors should work in collaboration with philanthropic experts to develop comprehensive charitable giving strategies that address clients’ unique circumstances.

Some key elements of effective charitable giving strategies include:

• Alignment with financial planning: Charitable gifts should integrate seamlessly with your clients’ overall financial plan. Tax advantages should always be optimized alongside wealth management objectives.
• Social impact assessment: Help your clients define what social impact means to them. Are they focused on immediate community needs or long-term systemic change? Do they prioritize local Houston nonprofits or national charitable organizations?
• Diversification of charitable organizations: Rather than concentrating their giving to a single organization, many UHNW individuals benefit from supporting multiple charitable organizations that align with their values.
• Professional advisor collaboration: Engaging both financial advisors and philanthropic experts can help make sure charitable giving strategies complement broader wealth management and estate planning goals.

Partner with us: unlock your clients’ charitable giving potential 

As a trusted advisor, you understand the importance of providing your clients with personalized guidance and support. By partnering with Greater Houston Community Foundation, you can extend your expertise in philanthropic planning, offering your clients a comprehensive and tailored approach to giving. Think of the Community Foundation as the philanthropic arm of your firm—your go-to partner for your clients’ giving needs.

By working together, we can help you:

• Enhance your relationships with high-net-worth and UHNW clients
• Provide a unique value proposition to differentiate your practice
• Offer a comprehensive approach to financial planning, including philanthropic planning
• Connect your clients with the right charitable organizations aligned with their values
• Maximize tax advantages through strategic charitable giving strategies
• Document and preserve donor intent through multiple generations

Interested in working with us? Contact Andrea Mayes, Senior Director of Charitable Solutions today to learn how we can partner with you and your clients. Our expert team of philanthropic advisors can provide personalized guidance and support to help you deliver exceptional results.

More Helpful Articles by Greater Houston Community Foundation: 

• Incorporating Charitable Giving into Your Investment Strategy
• Integrating Philanthropy into High-Income Tax Planning
• Why Donating Appreciated Stock Makes Financial Sense
• How To Preserve Generational Wealth
• The Importance of Charitable Giving and Financial Planning

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