A charitable conversation that yields results


Talking to your clients about their philanthropy is an excellent way to get to know them better and deepen your relationship. It also yields critical information to help you develop effective charitable strategies and a strategic charitable plan.

Many advisors have asked us how to make the charitable conversation most productive. Here are some ideas.

  • Current giving
  • Year-end giving
  • Portfolio rebalancing
  • Taxable accounts: appreciated securities, high capital gains, low cost basis
  • Retirement assets: RMDs and IRA remainders
  • Trust accounts: discretion to give to charity
  • Illiquid assets: sale of a company; appreciated real estate, artwork and collectibles; hedge fund interests; private equity; IPO stock; restricted stock, etc.
  • Windfall: bonus, inheritance, etc.
  • Private foundation
  • No heirs
  • No named beneficiaries
  • Charity as beneficiary
  • Lives in HNW area

    “In looking at your accounts, I see some charitable planning opportunities…”

    “As we discuss your financial / retirement / estate plan, let’s consider the role of charitable giving…”


Questions Possible responses

Do you have a favorite charity or charities?

What causes are important to you? What needs are you trying to help them with?

Are you involved with any nonprofit organizations? Are you on a board?

If they have difficulty articulating an overall charitable approach, ask if they have considered being more strategic in order to have a greater impact with their philanthropy. 

How much did you give to charity last year?

If the answer is more than $25,000, certain giving tools might be more advantageous than others.

Do you make charitable gifts as part of your year-end tax strategy Or do you give throughout the year?

Encourage them to consider gifting throughout the year since charities often run into shortfalls beyond year-end. At any time of year, recommend levels at which they might want to gift to receive maximal tax benefits, especially with certain types of charitable assets and giving tools.

How do you normally give—i.e., with a check, through a giving tool, etc?

If they give with a check, donating other types of charitable assets can provide more tax advantages than cash.

If they use giving tools, review with them to ensure they’re using them to their maximal benefit or talk about alternatives.

Do you currently include philanthropy within your financial and estate plans?

There may be opportunities to integrate charitable strategies with their other plans if they are not currently doing so.

Questions Possible responses

To what degree is it a priority for you to minimize your taxes through charitable giving?

There are tax benefits associated with different types of charitable assets and giving tools, and particular opportunities to create a charitable strategy and charitable plan for clients who say they:

  • Aren’t focused on charitable giving but are focused on reducing taxes.
  • Have a high-charitable and high-tax focus. Since they may want more control over the transfer of their wealth and charitable values, talk to them about involving their family in their philanthropy and legacy planning.
  • Have a high focus on charitable giving but a low focus on the associated tax advantages.

There are generally three ways we can pass along our money: to the IRS, heirs, or charity. Which do you prefer?

To minimize what clients pay in taxes, help them think strategically about what they want to give to their heirs vs. charity.

Questions Possible responses

Do you want your family to participate in your philanthropy now—during your lifetime?

Many donors tend to think of philanthropy as less of a choice and more of a responsibility to give back, and wish to instill that sense in their family.

Do you want to involve your family in your philanthropy after you pass?

Name children in charitable succession plans or as beneficiaries.

If so, how do you want to engage your family members in the process?

Involving family can take many forms.

Do you want to create a family charitable plan?

Many families create a charitable plan so they can work together strategically in their philanthropy.

Would you like me to help facilitate conversations with your family about charitable planning?

Help get the conversation going and assist with creating a charitable plan.

Questions Possible responses

Do you want a charitable giving legacy?

Presuming your assets outlive you, what do you want that legacy to look like?

Who do you want to involve in your charitable legacy? Family? Charities? Other beneficiaries?

Discuss estate planning techniques using various types of charitable assets and giving tools.

It’s also an ideal opportunity to ask how they want to involve their family in their philanthropy.

I see you don’t have beneficiaries named for your accounts. Can we talk about some alternatives?

Can name charities as beneficiary in certain types of charitable assets and giving tools.

Questions Possible responses

>Are you familiar with the tax benefits of donating noncash assets to charity?

Giving other types of charitable assets may be more tax-efficient than cash.

Are you interested in donating appreciated stocks, bonds, mutual funds, or ETFs?

Do you have appreciated property—real estate, artwork, collectibles—you could donate?

Receive additional tax benefit by donating appreciated securities and appreciated property rather than cash—avoid or reduce capital gains and income taxes.

Do you want to donate the remains of your IRA?

Name charities as beneficiaries of their IRA remainder to reduce heirs’ estate tax and future income tax liability.

Do you want to distribute some or all of your RMD to charity?

>Avoid paying income tax on the amount of the RMD while satisfying the requirement from their IRAs.

If your beneficiaries are financially independent, do you need this life insurance policy?

Liquidating a valuable yet less productive asset like life insurance yields an income tax deduction and lowers estate tax for heirs.

Are you thinking about selling your company?

Shares or interests from the sale of a business can be donated prior to the sale to maximize tax benefits.

Do you hold hedge fund interests / IPO stock / private equity / restricted stock?

Avoid tax on unrealized gains and take an income tax deduction by donating these types of charitable assets to charity.

What is the timing of your noncash gift?

Timing matters—for instance, will there be adequate time for liquidating illiquid assets?… or…what is the redemption period for selling hedge fund interests?

What are your succession plans for your company / IRA / second home?

Can donate proceeds of business interests, appreciated property, and remainder of IRAs for tax benefits.

Questions Possible responses

Are you familiar with charitable giving vehicles?

There are a range of giving tools, which vary by cost, distribution to charity, control or level of input, legacy options, tax effectiveness, and recognition vs. anonymity.

Is your private foundation / community foundation / charitable trust or annuity enough for you? Do you want to consider using other giving tools?

Many donors allocate their charitable dollars among multiple giving tools. A diversified approach to giving can optimize tax benefits and create more strategic philanthropy.

>Do you want to maintain maximum control and don’t mind paying an excise tax, filing an extra tax return, and following strict granting regulations?

A private foundation may make sense if asset levels to fund are high enough.

Do you want to consolidate your charitable giving to multiple charities through one account and simplify your tax receipts?

A donor-advised fund may make sense.

Do you want an income stream for yourself or a family member through a donation?

Consider charitable gift annuities or charitable trusts to obtain an income stream and estate tax benefits.

Do you want to make a contribution and take your time deciding how to grant it, enabling you to grow the assets in the meantime?

A donor-advised fund helps to do that.

Do you want to give nationally, internationally or locally?

Grant anywhere with most giving tools. For local granting, however, it may make more sense to use a community foundation.

Do you want to grant anonymously?

Recognition vs. anonymity choices vary across giving tools.

Have you thought about how you’ll continue to support your favorite charities during retirement?

Contribute to a donor-advised fund during income-producing years and grant from it in retirement.

Do you want to support charities beyond your lifetime?

Legacy options vary across giving tools.

Questions Possible responses

Can I work with your other advisors to make sure we develop the most effective charitable strategy for you?

In addition to their current team, offer to bring in additional charitable giving experts like Vanguard Charitable for additional perspectives.