Laying the Foundation of Giving

Philanthropy is second nature for some donors. They’ve been giving for so long it’s almost like breathing. That’s the case for a donor we’ll call Ben.

Ever since he can remember, Ben has been drawn to helping others—first as a youngster collecting donations for UNICEF at Halloween, then as an adult volunteering and donating to social causes. Ben’s lifelong practice is rooted in the Jewish traditions of tzedakah and tikkun olam, where giving isn’t just an occasional activity but a moral obligation to make the world a better and more just place. 

Today, after completing a successful career leading and managing multiple companies profitably, Ben is as dedicated as ever to fulfilling that mission. In this third stage of life, he has carved out time and made an active and structured commitment to philanthropy as a retiree. 

TIP:

Consult with your accountant when you’re thinking of giving to a charitable foundation. Converting stocks so the funds can be directed to a legal entity like a foundation might be achieved while avoiding a capital gains taxes. You could properly ensure that more of your contribution would be directed towards the foundation’s effort.

In this new role, Ben is a hands-on player in his giving plan with clear ideas about where and when to donate and how to make it all possible. After talking with his accountant, for example, the two decided that it made sense for Ben to set up a legal entity known as a foundation, funded by the transfer of an allotment of appreciated stock. 

The arrangement has several benefits: By moving a block of appreciated stock to fund the charitable foundation, Ben avoided capital gains taxes, which he would have incurred had he sold the stock instead and used the proceeds for charitable purposes. 

Since he did not pay the capital gains tax—in his case 20%—the full value of the stock was preserved and those funds are now available to be given out to society. In addition, Ben was able to take a deduction in the current year of the transaction.

The foundation has given Ben financial peace of mind and added meaning to his giving. He is in control of his contributions and stays involved with the recipient organizations, whose missions align with his desire to improve people’s lives. Ben imagines he will continue to top up the foundation’s funds with more transfers of the same stock in the coming years. 

Thanks to the foundation, Ben is deriving greater joy and satisfaction from his philanthropy. His giving is organized. He’s able to give more regularly. And his values are driving his choices.

Here’s a look at the social issues and organizations that have captured Ben’s attention: 

• Education: Ben donates money and time to mentoring and coaching small business owners. He’s using his skill set as a business leader to help entrepreneurs avoid the common mistakes of running a business, which can lead to unnecessary expenses and possibly failure.

• Health care: Ben belongs to a cardiac rehabilitation group focused on longevity. After having major heart surgery, Ben took stock of how to improve his behaviors to increase his well-being. He now wants to make sure more of us know what’s working to help people feel more energy and be healthier longer.

• Disaster relief: In the wake of the devastating fires on Maui, Ben gave to the Maui Strong Fund, which is directly helping on the island. Ben liked that 100 percent of the donations go to community needs. 

• The arts: Ben’s love of music and other disciplines has shaped his giving. He supports various nonprofit arts organizations. 

In retrospect, it’s easy for me to understand how Ben got excited about starting a foundation and learning how to make it work for his grantees. The structure offers so much potential—for Ben personally and for the recipients.

Already, Ben is exploring how he might expand education grants to include individuals who could receive scholarships. And for the arts, he is considering doing some firsthand research about museums, coordinating visits with directors to gain a better understanding of the institutions.

The world is truly Ben’s oyster. He’s anything but retired!

What about your world? Have you wondered how you could be having more fun with your giving? Let’s talk about it.

When Health Care Costs Are High, Medical Angels Offer a Lifeline

Moments. We live for them. In 2022, as we were slowly reemerging from the sadness and challenges of the coronavirus, I was fortunate to connect with family, friends, clients, and colleagues for some uplifting conversations.

Amid the uncertainty and heartbreak of the pandemic, these moments of hope sustained me as we all navigated our new norms. They also kept me thinking about how to help with the social implications of a worldwide health crisis.

During one of these talks, a colleague asked me about the giving strategy of my clients, given the pandemic and its impact on donors. My answer was straightforward: Most of my clients stayed the course with their strategic giving plans. That’s the beauty of having such plans when inevitable disruptions happen.

For clients with health care priorities, their approach was to lean more heavily to their preferred nonprofits and expand their interest to prospective organizations working on vaccines. Because they already had giving plans in place, they were able to easily adjust to match their priorities and the times. 

Interestingly, I received a text early this year from a dear friend, Sharon Martinelli. Her message was short, sweet, and to the point:

“Hi, I'd really appreciate it if you would share or donate to this GoFundMe. (She included a link.) I have been supporting their monthly deficits for PT for a while and have supported the go fund me as an effort to create a cushion for safety. Let me know what you think.” 

My husband and I didn’t think long. After reading the post, we matched Sharon’s most recent gift the next day. First, we trust her savvy triaging for legitimacy. As a retired accountant, Sharon has tremendous experience in vetting clients and poring over numbers of those with sizable net worth. Second, after reading the GoFundMe post, we learned the recipient suffered from mobility issues. Her fight was for time and expert care to be able to walk.

Health care costs can be staggering in the United States and can unravel the lives of so many. 

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19% of households couldn’t pay for timely medical care according to a 2021 Census study

Did you know, for instance, medical costs are a main factor in personal bankruptcies? A May 2023 Forbes article looked at this critical issue. The report cited a 2021 Census Bureau study that found 19% of households couldn’t pay for timely medical care. That’s almost one in five. Imagine the neighbors in your community. Could one or more be struggling, possibly quietly, with the financial burden of health care costs?

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Forbes also referenced a 2022 report from the Consumer Financial Protection Bureau. In that report, the federal agency said medical debt was the leading reason debt collectors called on consumers. Statistics and reports like this reinforce why health care is such a priority for giving. 

When Sharon learned that my husband and I had decided to participate in her chosen GoFundMe, she was moved.

“I love you so much for doing that,” she wrote. “Not sure why she’s so deeply in my heart but she is. I’m grateful to you and love your support.”

Of the many gifts we could have given Sharon, this one clearly meant the most to her. There is a connection here, a very direct and personal way of giving—of helping. 

Moments. Of compassion and action.

Today, as you look at your priorities, what difference could you make by giving to an individual who has an immediate health care need?

The World Has Changed - So Has Giving

The world is clearly a different place today. To say the pandemic has changed us all is the ultimate understatement. Still, some things have remained constant–the bonds of friendship and family, the importance of community, and the critical role philanthropy plays in challenging times.

Since the early days of COVID-19, people have opened their hearts and wallets to help those in need. One study of high-net-worth investors showed that the pandemic prompted them to change their giving strategy, with many giving more. In addition, donors cited a personal interest in or connection to a charity or cause as a prime motivation for their giving.

This tracks with what I’ve seen firsthand. For many, giving has never been more important. 

In my work with clients, I hear time and again about the need for positive change. It’s not enough just to give, they tell me. The giving has to be meaningful, purposeful. I agree. And one of the best ways to do that is through a strategic charitable giving plan. It’s basically a blueprint for giving that tracks with your values and vision. 

In the study, over half of the people surveyed said they have a charitable giving strategy, with nearly all agreeing it is part of their overall wealth plan. It’s smart to do, for sure. But it’s also much more. 

I’ve found—and the survey did too—that one of the biggest reasons for charitable giving is pretty simple: People truly want to share their wealth to help others. Giving just feels good. So why miss out on that?

When I partner with clients, we spend a lot of time talking. It’s through conversation—sometimes directed, sometimes not—that we both learn what matters most. Some donors, for instance, are finding that contributing directly to causes through online platforms speaks to them in a way that traditional philanthropy doesn’t. 

Yes, the giving landscape is definitely changing. So whether you’re just starting out or already have a plan in place, it’s especially important to know and understand your options. 

Below are some questions to think about as you develop your giving plan. Take your time. There are no preferred responses. 

This questionnaire is designed to help you. How you use it is up to you. You can submit your answers now for a consultation. Or you can read through the questions and responses, decide what resonates, and jot down notes for a future conversation.

If now is the right time, just click on the circles that correspond to your responses, enter your name and email, and click on the black bar to submit. Our team will reach out to you. 

And remember, these questions are just a beginning. Let me know what else is important to you. After all, we’re starting a conversation here. I look forward to sharing more on these ideas with you in the future.

Let’s consider…

What’s your next step? Not quite ready to dive in? Some alternative suggestions as you contemplate: