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Rethinking inherited IRAs

Rethinking inherited IRAs

As you build your estate plan and consider how to provide for your adult children, keep in mind that naming children as the beneficiary of an IRA or other qualified plan probably is not something that should be automatic.

For starters, if you are charitably-minded and have other assets, such as highly-appreciated stock, to leave your children, those assets should come first. This is because your children will inherit the stock at a “stepped up” basis, meaning their capital gains tax hit upon sale will be far less. Plus, if you name a charitable organization, such as your donor-advised fund at The Community Foundation, as the beneficiary of your IRA, the IRA proceeds won’t be depleted by either income tax or estate tax. Your kids, on the other hand, will have to pay income tax on the proceeds of an inherited IRA.

This dynamic became even more important to consider when the law changed a few years ago, such that a child who was named as the beneficiary of a parent’s IRA, for example, could no longer count on a relatively straightforward and tax-savvy method of withdrawals called the “stretch IRA.” With the passage of the SECURE Act, that changed for many children who inherited an IRA after December 31, 2019. Instead of taking distributions over their lifetimes, affected children now need to withdraw the entire inherited IRA account within a 10-year period as calculated under the law.

If you’re evaluating options for how to handle an IRA in your estate plan, talk with your advisors and The Community Foundation about leaving an IRA to your donor-advised fund or other charity via a beneficiary designation. Or, if you’d still like to provide an income stream to your children following your death, in some circumstances it might be worth considering establishing a charitable remainder trust to name as the IRA beneficiary (assuming the stars align vis-a-vis children’s health, their tax brackets, projected returns, and other factors).

Importantly, if you are a child of parents who own IRAs, they will appreciate you bringing this opportunity to their attention! Your parents might not realize that their good intentions to leave their IRAs to their children could be saddled with tax burdens down the road. Encourage your parents to talk with their advisors and give The Community Foundation a call. We are here to help make IRAs a win for everyone–your parents, their favorite charities, and you!

This article is provided for informational purposes only. It is not intended as legal, accounting, or financial planning advice. 

Disaster relief efforts and The Community Foundation’s collaborative role

Disaster relief efforts and the community foundation’s collaborative role   

Our hearts go out to the people of Maui—and all of Hawaii—in light of the tragic fires that occurred early in the month. By all accounts, those will take years, if not decades, to recover and rebuild from. Restoration costs are already estimated at $5.5 billion, although only time will tell just how much time and money will be needed. 

 

As if that weren’t enough, much of the U.S. slogged through what has been called the hottest summer ever—and July as the hottest month ever—with uncomfortably high temperatures affecting land and sea even before the start of hurricane season. And then there was Tropical Storm Hilary and a simultaneous magnitude 5.1 earthquake that struck Southern California. To round out the month, Hurricane Idalia made landfall on August 30, with extensive damage reported and tens of billions of dollars of losses projected. 

Fortunately, community foundations are well-suited to facilitate and manage relief funds for disasters and humanitarian tragedies, no matter where they occur. Certainly local community foundations in the areas most affected by a disaster consistently jump in immediately to establish funds to accept donations, which the community foundation then deploys rapidly and effectively to high-performing nonprofit organizations that are delivering relief where it is needed most urgently. 

 

Even community foundations and other charitable foundations that lie outside of affected geographic areas are committed to responding quickly by launching their own fundraising efforts, either promoting the funds established by community foundations in the affected areas or their own funds created to directly support relief efforts. Indeed, disaster relief funding is frequently coordinated by community foundations, which are widely viewed as one of the very best vehicles to help donors provide financial support to relief efforts. Community foundations understand, for example, that the most immediate needs in the wake of a disaster are often for food, shelter, water, and hygiene kits. In addition, The Community Foundation knows which nonprofit organizations on the ground are best qualified to meet those needs. 

 

With a deep understanding of philanthropy and charitable giving tools to effect meaningful change, the team at The Community Foundation is here for you. Whether your interests include disaster relief, education, the arts, social services, or other causes near and dear to your heart, The Community Foundation can help you fulfill your goals and intentions.

This article is provided for informational purposes only. It is not intended as legal, accounting, or financial planning advice. 

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

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

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

An important 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 The Community Foundation.

The process of organizing charitable giving itself creates much-needed clarity around the family’s philanthropic purpose. This is because without an organized approach to family giving, it is easy for children and grandchildren to get confused about their parents’ and grandparents’ processes for making decisions about which nonprofits to support.

Consider this scenario:

“Before we got everything organized through The Community Foundation, our family seemed to take a shotgun approach to charitable giving,” commented the daughter of an entrepreneur who formed a family donor-advised fund upon the sale of a business.

Her mother, the entrepreneur, 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 fund at The Community Foundation can be a very effective solution for many of your clients who are launching a multi-generational giving strategy. Here’s why:

–Community Foundation vehicles 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 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. This is especially useful in the case of 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 The 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 a Community Foundation, your clients, as well as their children and grandchildren, are part of a community of giving and have opportunities to collaborate with other donors who share similar interests.

–The Community Foundation can work with a client and the client’s family on a charitable giving plan that extends for multiple future generations. That is because the experienced team at The Community Foundation supports strategic grant making, family philanthropy, and opportunities to gain deep knowledge about local issues and nonprofits making a difference.

–Finally, The Community Foundation’s tools and resources make it much easier for families to communicate across generations about the family’s charitable giving purpose and goals for 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 that is customized to meet each client’s unique purpose.

This article is provided for informational purposes only. It is not intended as legal, accounting, or financial planning advice. 

It’s (always) a great time to review your estate plan and legacy gifts

It’s (always) a great time to review your estate plan and legacy gifts

Don’t forget that August is National Make-A-Will month. Even if your estate planning documents are already in place, this is still a good time to review your will, trust, and beneficiary designations to ensure that they still capture your financial and family situation, as well as your intentions. 

It’s hard not to be inspired by the incredible stories of generosity that no one saw coming. Every year, many nonprofit organizations receive estate gifts that they had not expected. Stories about these donors are heartwarming! (And, though not a bequest, we’re all inspired by extraordinary anonymous gifts!)

Remember, your fund at The Community Foundation can be an ideal recipient of estate gifts through a will or trust, or through a beneficiary designation on a qualified retirement plan or life insurance policy. Bequests of qualified retirement plans–such as your IRA–can be extremely tax-efficient. This is because charitable organizations such as The Community Foundation are tax-exempt. This means the funds flowing directly to a fund at The Community Foundation from a retirement plan after your death will not be reduced by income tax. This also means the assets will not be subject to estate tax.

The Community Foundation makes it easy for your attorney to draft bequest terms in legal documents, including beneficiary designations of retirement plans and life insurance policies. Please contact our team for the exact language that will ensure alignment with your intentions.

Keep in mind that even after you have executed estate planning documents or beneficiary designations, in many cases you can update the terms of the fund at The Community Foundation designated to receive the bequest upon your death. You will love the ease and flexibility!

We look forward to hearing from you and your advisors as you update your estate plan to ensure that your community legacy is intact!

 

This article is provided for informational purposes only. It is not intended as legal, accounting, or financial planning advice. 

Like entrepreneurs, philanthropists inspire and innovate through their investments

Like entrepreneurs, philanthropists inspire and innovate through their investments

Despite the recently-announced decline in 2022 charitable giving, we continue to hear inspiring stories from you and other fund holders and donors. We’re also hearing from more and more individuals and families who are not yet fund holders that they’re very interested in establishing a donor-advised, field-of-interest, designated, or unrestricted fund at The Community Foundation, and nothing could make us happier! Increasing charitable giving and connecting donors to their favorite important causes are our priorities at The Community Foundation.

The uptick in conversations about philanthropy has inspired us to reflect on the noteworthy generosity of so many entrepreneurs who become very generous donors and leaders in philanthropy. And on that front, the news keeps getting better. For example, the Giving Pledge has added six pledgers already in 2023, one more than during all of 2022; savvy investors, especially in the tech sector, are enjoying the market’s 2023 rebound, at least so far; and we’re seeing an increase in the number of those who’ve experienced successful business exits take a visible role with their commitments to important projects in their regions. 

Over the years, we’ve observed an interesting trend. Entrepreneurs are certainly donors, but are donors entrepreneurs? In other words, is an entrepreneur’s approach to philanthropy similar to the entrepreneur’s approach to building a business? Do they give it like they made it?  

We believe the answer is yes, absolutely. And often in ways that entrepreneurs–and other donors, for that matter–may not consider. 

Indeed, an “entrepreneur” is sometimes defined as a person who aspires to build something bigger than themself. That’s exactly what happens when a donor supports favorite causes through a donor-advised or other type of fund established at The Community Foundation. This is especially appropriate because contributions to funds at The Community Foundation are much more than simply charitable donations. Contributions are investments in local philanthropy to improve the quality of life in our region and to support the causes the donor cares about. The return on investment is human-centered rather than only financial, and those returns deliver benefits to not only the nonprofits who receive grants from the fund, but also to the community as a whole.

Here are few ways that gifts—rather, investments—via a fund at The Community Foundation are similar to entrepreneurship:

–A gift from one person, one couple, or one household can have a generous ripple effect that “scales” to help many, whether that is to feed many families, subsidize a childcare center, or help support programs that allow parents to work and earn a living.

–Donated funds are the “seed money” that can inspire innovation, the kind that allows the grantee organization to function in new and efficient ways. 

–A gift can expedite creation of the recipient organization’s brand new programs via pilots (in the tech world, “MVPs, ” or minimally viable products). This form of testing and learning is a critical step to achieving product or service viability, whether in the for-profit or nonprofit sector.

–Philanthropic support can provide a nonprofit organization with the means to hire much-needed talent, such as a social worker or a fundraising professional. This is not unlike an entrepreneur’s need to hire key team members, such as a software engineer or a full-time chief financial or accounting officer, who may have otherwise been unaffordable or delayed in coming onboard. 

–When philanthropic support is provided through a local business development initiative, a grant can provide ongoing funds that help create new businesses and jobs, whether for essential services or potentially breakthrough technologies. This type of investment is entrepreneurial on both the for-profit and nonprofit sides of the equation! 

If you’re interested in reading more about entrepreneurs as philanthropists, you might enjoy specific topics such as making charity a habit, checking out a punch list of five ways to give back, and a few “oldie but goodie” perspectives that have stood the test of time. 

By employing an entrepreneurial mindset, donors can envision and deploy their gifts as investments capable of helping charitable organizations scale to great success and make a real difference in the quality of life for the people they serve. The Community Foundation is always happy to discuss various ideas and strategies to leverage entrepreneurial principles in your charitable giving, whether or not a donor or fund holder is an entrepreneur. We appreciate the opportunity to work together! 

This article is provided for informational purposes only. It is not intended as legal, accounting, or financial planning advice. 

Legacy giving: A conversation that’s full of opportunity

Legacy giving: A conversation that’s full of opportunity

August is National Make-A-Will Month. This means your clients may be reading articles and hearing about estate planning more this month than usual, which makes the next few weeks an especially good time to prompt your clients to review their estate plans–or get their wills and trusts in order if they haven’t done so yet.

Charitable giving is an important part of any estate planning conversation. Certainly, bold, legacy-making plans are frequently in the news because of the high-profile people who establish them. Your clients may not realize that they, too, and nearly anyone, really, can leave a legacy to support favorite charitable causes.

By discussing what legacy charitable gifts are, how they work, what the client has in mind, and then formalizing the client’s plan with the proper legal and financial documentation, you can help your clients tie up a few of “life’s loose ends” far in advance of when that legacy gift is actually made—and give your client the peace of mind of knowing it will actually get done.

Clients’ charitable giving intentions and the possibility of establishing legacy gifts should be a routine and standard topic of any financial or estate planning discussion, right alongside provisions in an estate plan for family and loved ones.

Here’s a primer to help you simplify key principles as you convey to your clients what they need to know about leaving a legacy:

Q: What is a legacy gift to a charity?
A: Encourage your clients to think of leaving a charitable legacy as a post-life gift that the client structures in advance. Legacy gifts are often referred to as planned giving.

Q: What assets can be used to make a legacy gift?
A: Like the gifts to charity that your clients are already making during their lifetimes, cash, stock (especially highly-appreciated stock), real estate, life insurance, an IRA beneficiary designation (which is extremely tax effective), are examples of assets that can be the subject of a legacy gift. A legacy gift can be expressed in a client’s estate planning documents as a dollar amount, percentage of the whole, or a legacy gift of the assets themselves. Your client will want to choose assets carefully, enlisting your expertise to do so.

Q: How is a legacy gift actually made?
A: Legacy gifts are typically spelled out in detail in a client’s will or trust documents. This is especially important because after the client is gone, too much is otherwise potentially subject to hearsay or conflict. To attorneys, accountants, and financial advisors, this is common sense. But do not overestimate your clients’ understanding about estate plans and how they work. A surprising 2 out of 3 Americans have no estate planning documents!

Q: How can a discussion about legacy gifts help motivate clients?
Estate planning can be an uncomfortable topic because, by definition, it requires a client to contemplate mortality. This is likely part of the reason that 40% of Americans say they won’t even consider putting a will in place unless or until their life is in danger. Most clients think charitable giving, though, is a much more pleasant topic than discussing the end of their own lives. That’s why legacy giving is a topic that can help break the ice and pave the way for the broader, essential conversation about overall estate planning.

Q: What are some particulars to be aware of?
A: Most legacy gifts can be revoked or altered through beneficiary or will changes while the client is alive. This is an important feature to mention to clients who want to include charitable giving in their estate plans but like the idea of flexibility as the overall family and financial picture changes over the years.

Q: What tools does The Community Foundation offer to help?
A: A particularly useful technique is for a client to establish a fund at The Community Foundation that spells out the client’s wishes for charitable distributions upon death to specific organizations. The client’s estate planning documents can, in turn, simply name the fund as the beneficiary of charitable bequests. The client can adjust the terms of the fund anytime during the client’s lifetime to reflect evolving charitable priorities.

We look forward to working with you and your charitable clients as they firm up their legacy giving plans, whether in August or anytime of year!

This article is provided for informational purposes only. It is not intended as legal, accounting, or financial planning advice. 

Making it fun: Tips for teaching children about philanthropy

Making it fun: Tips for teaching children about philanthropy 

Over the years, you’ve probably taught your young children, grandchildren, nieces, and nephews lessons along the lines of “share and share alike” and “better to give than to receive.” But how do you transition these lessons into more concrete instruction about charitable giving, without risking the youngest members of your family becoming overwhelmed or bored? And how can you make those lessons effective as children grow older?

To inspire teenagers and young adults, consider tapping into an increasingly popular topic among younger generations, which is the notion of “purpose.” “Finding one’s purpose,” in the context of both personal lives and careers, is also a concept that can unite generations within a single family. The overarching purpose of giving can be framed as making the world a better place or strengthening the community. This translates nicely for youths who are seemingly always asking, ”Why?”

Teaching young children about philanthropy can be a little trickier. Indeed, many donors and fund holders at The Community Foundation have expressed an interest in learning how to do this. Here are a few principles that might help. And, as always, reach out to the team at The Community Foundation for ideas related to your own particular situation.

Positive reinforcement is a must.

As with any successful learning experience, positive reinforcement is a must in teaching the values of charitable giving. In particular, you may want to consider reinforcing that every charitable gift is good regardless of the profile of the giver, the size of the gift, or the nature of the recipient. Positive reinforcement in charitable giving is effective because it first engages the charitable giver’s own understanding of what it means to be philanthropic—from the giver’s own perspective–even if that giver is very young. So when your school-age children or grandchildren are raising money for a charity through a school fundraiser, throwing coins into a fountain to support a local children’s hospital, or donating gently-used toys and clothing, make sure you let the child know that these gifts really do make a difference.

Charitable giving can be defined expansively and inclusively.

When you’re talking with a 10-year-old, conversations about giving back are most productive when they go well beyond discussions about big checks written to highly-visible organizations. You may find it helpful in your conversations to cast a wide net around the definition of what it means to be charitable, often including things like adopting an older dog who needs a home, turning off lights to help the environment, cooking dinner for neighbors in need, helping to pay a family member’s medical bills, and recycling aluminum cans. Your enthusiasm during the conversation will be contagious as you convey the opportunities. The world is full of good deeds waiting to be done!

Tap into what the child cares about.

How do you know what charitable causes might inspire the young children in your life? Ask! You’re likely to hear things like animals, moms, friends, family, trees, school, reading and writing, having a home, finding missing people, helping to rescue victims of natural disasters, and having clean air and water. Any one of these elements gives you a fantastic opening for further dialogue, especially when you start that conversation based on the lens through which children see the world in their everyday lives and identify the needs within it. Charitable giving opportunities are abundant!

Understand that children have a power and direction all of their own.

Even 10-year-olds these days are assertive, aware of news and world affairs, and most importantly, digital natives. They like to figure things out on their own. With the tiniest bit of guidance and a lot of encouragement, their ideas go a long way. Let a child’s interests guide your lesson on giving. You do, however, have a strong power of suggestion as an adult. Kids do not necessarily know how to find the exact names of charitable entities, and they certainly do not know what “501(c)(3)” means, but they remember a place after they’re told it does lots of good for people.

Keep it short and keep it mutual.

The children in your life are brilliant, wonderful, and perceptive, but they do have short attention spans. Make the lessons informal, spontaneous, and flexible, and create plenty of opportunities for storytelling and game time. Children have a story for everything, and they love to share. Let them talk about how they feel. Let them tell you how, where, and why they want to give.

Take action! 

Finally, don’t just talk–take action! For children with a grasp of money, charitable values can be taught through allocations. For the youngest, that may be from a weekly allowance or earnings from performing household chores. For the more experienced, allotments can come from after-school or summer job earnings. Giving can be highly interactive or participatory. For example, parents can show children the causes they support or suggest potential grantees based on the child’s interests, and let them choose. Parents can also show them how a gift can be easily made from the family’s donor-advised fund at The Community Foundation, which offers many benefits and can often be named to include names of the child or children.

At The Community Foundation, we’re here to help your family–even its youngest members–convert ideas into reality for the causes they care about the most.

This article is provided for informational purposes only. It is not intended as legal, accounting, or financial planning advice. 

Unlock the unexpected power of regret to grow your charitable giving

Unlock the unexpected power of regret to grow your charitable giving

Not surprisingly, financial regrets are common, with those related to personal finances among the most frequent. Of recently surveyed American retirees, 75% wish they’d started saving earlier, and 62% wished they’d saved more money for their golden years.

On the personal side of the equation, people frequently also regret failing to show kindness when someone was in need. These types of regrets can be uncovered in the flipside of the well-documented motivations for giving in the first place. In short, people want to help others and, upon reflection, they often regret not doing so.

The topic of regret is getting a lot of play. In his 2022 book, The Power of Regret: How Looking Backward Moves Us Forward, Daniel Pink describes the results of his years of research on human regret. Pink identifies different types of regret and offers readers the perspective that not all regrets need to act as negative forces if they inspire you to behave differently moving forward.

The experienced team at The Community Foundation can help you avoid charitable giving regrets, especially by making it easy for you to activate your charitable intentions in the most tax-effective ways possible to make an even bigger difference in the causes you care about.

For example:

Get organized with a donor-advised fund.

If you’ve already established a donor-advised fund at The Community Foundation (or if you are considering doing so!), you know that The Community Foundation handles all of the logistics, including providing 501(c)(3) status for your fund so that your contributions are tax deductible, facilitating your contributions to the fund in the form of cash or stock, processing disbursements to your favorite charities, and handling all of the necessary tax documentation. A donor-advised fund makes it so much easier to organize and maximize your charitable giving.

Grow your philanthropy through planned giving.

In many cases, The Community Foundation can help identify ways you can support your favorite charities at even higher levels than you thought possible by deploying planned giving techniques such as bequests and charitable remainder trusts. Designating your fund at The Community Foundation as the beneficiary of your IRA, for example, is especially powerful.

Rally other fund holders and donors.

If you’ve established a field-of-interest or designated fund at The Community Foundation, don’t forget that you can rally friends and family to join you in growing that fund. Philanthropic individuals and families are often open to new ideas about where to invest their charitable dollars. Many people look to The Community Foundation as a point of validation that the IRS’s boxes have been checked and for peace of mind knowing that the fund is benefiting from both the oversight and advocacy of a dedicated community institution. What’s more, it’s rewarding as a fund holder to get to know other fund holders and donors who are involved with The Community Foundation and who also want to explore ways they can support the various funds featured in The Community Foundation’s marketing materials and on our website.

If you’re wishing you’d been able to do more for your favorite causes earlier in your life, there’s no need to hold onto those regrets! The Community Foundation can help you build a charitable giving plan to reflect a lifetime of strong commitment to the organizations in our community. We look forward to working with you!

This article is provided for informational purposes only. It is not intended as legal, accounting, or financial planning advice. 

Recognition or anonymity: Which one’s for you?

Recognition or anonymity: Which one’s for you?

The Community Foundation is committed to working with you and your family to fulfill your charitable goals, whether those goals relate to making an impact, leaving a legacy, saving money on taxes, expressing gratitude, or a combination of objectives. If you have not yet established a fund at The Community Foundation (and even if you have!), it might interest you to know that a donor-advised fund or other type of fund not only offers flexibility to meet your giving goals, but also gives you options for recognition or anonymity, depending on your goals and preferences.

Many philanthropic individuals and families appreciate–and sometimes even seek–recognition for gifts to their favorite charities. In addition to feeling appreciated, donors give publicly for many other reasons, including knowing that their names can lend credibility to an organization and that their gifts can serve as an inspiration to other donors. The team at The Community Foundation also understands the perspectives of nonprofit organizations about anonymous giving. This means we can help you navigate your relationship with a favorite charity, which in turn allows us to help ensure that your intentions are achieved and the nonprofit’s mission is supported in the way you envision.

The Community Foundation carries out your wishes for recognition in a variety of ways. When you recommend grants to your favorite charities from your donor-advised fund, for example, The Community Foundation’s team typically will issue the grant checks to the charities noting that the gift is from your fund so that you receive the recognition. Sometimes, though, our fund holders have good reasons for wanting their support to be anonymous, whether because of modesty, religious convictions, avoidance of unwanted solicitations, or wanting to keep the focus on the charity.

Whatever the reasons you might prefer to give anonymously, whether from time to time or across the board, The Community Foundation respects your wishes and can help in a variety of ways.

–First and foremost, our team will listen intently to understand your charitable goals and interests and make sure that we are structuring your donor-advised fund, other type of fund, or series of funds to achieve your charitable giving and family philanthropy goals. Indeed, some individuals and families set up multiple funds to serve different needs, including the desire for anonymity for a portion of their giving but not all. Our team will be sure to ask clarifying questions to determine how best to structure your charitable funds to achieve your desired level of recognition. Do you prefer anonymity for every grant? Is there a threshold amount where smaller grants can be acknowledged? Does the restriction apply only to a public disclosure by the grantee, but the grantee organization is itself aware? We know these discussions can be delicate.

–You may wish to recommend that certain grants (but not all grants) from your fund be issued anonymously. The Community Foundation offers the ability to opt in to anonymity on a grant-by-grant basis. Also remember that no solicitations will flow directly to you; The Community Foundation handles all correspondence related to grants to nonprofits made from your fund.

–Remember that you can establish a donor-advised fund under a nondescript, less identifiable name, perhaps one that is generic sounding or honors ancestors who may have “seeded” the fund through a prior generation’s wealth transfer or inheritance. For example, you can select a name for your fund that is something less obvious than your own name. Instead of the “Sam and Vera Barker Fund,” for instance, you could name the fund the “SVB Fund,” “Desert Family Legacy Fund,” or something else. When The Community Foundation sends a grant check to a charity from your fund based on your wishes, the charitable recipient will see only the name of the fund, not your name.

–As always, with any fund (whether some or all of the grant making is anonymous) The Community Foundation’s code of ethics and operating principles mean that our team follows and enforces strict confidentiality. For example, we are careful about visibility and accessibility of donor information even internally, and we adhere closely to permissions and protections within the donor database.

–Finally, The Community Foundation does not disclose information about you or your fund to any third party, nor is detailed information available through a Form 990 filed with the IRS.

At The Community Foundation, we’re here to serve the greater good. We welcome all conversations about giving, and we gladly strive to honor the charitable giving preferences of our donors and fund holders to the fullest extent allowed by law.

This article is provided for informational purposes only. It is not intended as legal, accounting, or financial planning advice. 

Bridging the gaps in multi-generational family philanthropy

Bridging the gaps in multi-generational family philanthropy

Differing views within families is nothing new; differing views about nearly anything and everything is centuries old. For generations and generations, common topics of disagreement have included popular culture, politics, religion and parenting, just to name a few. Frequently outranking all is money—how it’s made, spent or saved—or not.

How benevolent families share money, whether agreeably or disagreeably, is a topic all its own. It’s perhaps never been more relevant than now given these realities: up to four generations living simultaneously; longer lifespans; more willingness to discuss family finances; differing social views; and the desire of older generations to set a good philanthropic example while retaining some control of assets built over many years.

And the “share” discussion will likely continue for decades.

According to figures cited in a May 2023 New York Times article (subscription required), total U.S. family wealth of $38 trillion in 1989 more than tripled to $140 trillion in 2022, with Baby Boomers and Generation X holding 90% of that. By 2045, older Americans will pass down a projected $84 trillion to Millennial and Gen X heirs, with $16 trillion transferring by 2033. With evermore wealth circulating, both ideas and conflicts about its use will likely result.

As an advisor, it is your responsibility to help your clients achieve their goals for their estate plans, financial plans, and charitable objectives. As you work with your multi-generational philanthropic clients, you have no doubt noticed that even a subject as uplifting as philanthropy can lead to lively discussions and sometimes even disagreements. To fulfill your role, you will need to lean on strategies to navigate conversations about charitable priorities when not everyone is on the same page.

You can also lean on The Community Foundation–and we encourage you to do so! Community foundations occupy a unique position in the midst of the unprecedented wealth transfer now underway: that of arbiter, guide and even peacemaker among benevolent multi-generation families. In addition to understanding the needs of the community, the nonprofits and programs that are addressing those needs, and the ins and outs of the tax vehicles best suited for your clients to help meet those needs, our team is also deeply experienced in facilitating productive dialogue among people who bring valuable, diverse viewpoints to the table.

As a secure, convenient, and trusted partner to help a family invest wealth in charitable causes, The Community Foundation can help you work with your philanthropic clients in a variety of ways:

–The Community Foundation team focuses on listening to understand the cross-generational and intra-generational values of a family.

–We ask a lot of questions about what causes matter to your clients and the origins of those preferences, both historically and now.

–Our team seeks to understand a family’s values, and then we research and suggest potential grantee organizations or causes if the family is seeking input. We can also deeply research organizations that the family is already supporting.

–The Community Foundation offers to educate the various generations about the tactical opportunities including donor-advised funds, field-of-interest funds, unrestricted funds, designated funds, and anonymous giving, among others.

–Our team is happy to develop options for multi-cause allocations that peacefully meet the needs of all involved.

–For geographically dispersed generations, our team offers to meet at agreeable intervals, even digitally, to understand a family’s current and changing views.

We are here for you and the philanthropic families you serve. As the needs, capabilities and opinions around wealth expand, The Community Foundation can be a facilitator of conversations, connection, and contributions among well-intended but independently-minded families and help you carry out your professional responsibilities. Call us anytime on Monday through Friday at 540-432-3863 or learn more at our website: www.tcfhr.org.

This article is provided for informational purposes only. It is not intended as legal, accounting, or financial planning advice.