You can provide additional value to your clients by helping them move from the often one-off, short-term focus of charitable giving to strategic philanthropy, a more thoughtful approach designed to have short- and long-term impact on causes deeply important to your clients. Key to this process is creating a strategic charitable plan that addresses your clients’ giving goals and preferences, now and for the future.

Begin with the charitable conversation. Although leading with financial topics may seem more natural, research shows the importance of first ascertaining your clients’ altruistic motivations and values to better understand them before recommending charitable strategies and starting to create a charitable plan.¹ 

Charitable plans will vary depending on the individual client and should flex if the client’s circumstances change, but here are six steps that Vanguard Charitable recommends for building a successful plan.
 


Vanguard Charitable can help you answer these questions and more:

How can I tell if my client has charitable intent?

My client is ready to give... now what?

How can I get the whole family involved in the giving process?

How do I help my client create a strategic charitable plan?

What charitable assets should my client use for donations?

How should they give—what’s the best tool for making these gifts?
 

What impact do they hope to achieve with their giving—how would they like to change the world?


Among wealthy donors’ greatest charitable giving challenges are identifying what causes they care about and deciding where to donate, understanding how much they can afford to give, monitoring giving to ensure it has its intended impact, and structuring gifts tax-efficiently.
 

  • What milestones or achievements do they want to achieve in the short and long term with their giving?
  • Is it a priority to minimize taxes through charitable giving? To what degree?
  • What charitable causes, programs, geographic regions, etc., do they want to support? Or do they have specific charities in mind?
  • How will their charities be vetted? Who will do that research?
  • What’s their time frame for giving? For instance, do they want to make regular small gifts while saving for larger gifts in the future?
  • Can they adjust their current giving patterns to increase and sustain their charitable impact?
  • How do they want to balance their cash flow needs with charitable gifts?
  • What does success look like? How will they measure success?
 
  • Do they want their family to participate in their philanthropy now? If so, to what extent?
  • How do they want to involve their family in the process?
  • Do they want to create a family charitable plan? If so, how do they want to approach it—i.e., do they want their charitable goals to be the focus or do they want to include the goals of family members?
  • Are there common themes in family members’ charitable values?
  • How can you help facilitate the family conversation?


A husband and wife have had a DAF account for several years and have supported several causes. Their two adult children are also giving-oriented but lack their parents’ resources and tax benefits. Last year the parents told each child to pick one or two organizations that they believe in and the parents would grant to them. “This has evolved into a wonderful opportunity for all of us to discuss philanthropy and the organizations and issues that we all believe in,” the father said. 

See more ideas from Vanguard Charitable donors for involving family in philanthrophy.
 

  • What is the purpose of your clients' wealth? There are generally three ways they can distribute wealth—to heirs, charity, or the IRS. To minimize what clients pay in taxes, you can help them think strategically about what they want to give to heirs vs. charity.
  • What other estate planning techniques can help them?
  • What charitable giving assets and giving tools will reduce their heirs’ estate tax burden?
  • What charitable bequests do they want to make in their will?
  • What charitable giving roles do they want their heirs to carry out after their lifetime?
What does your client count as wealth and where will it go?



 

Typical ways to create a legacy with a donor-advised fund account: leave the account to successors, endow it directly to charity, and fund it through deferred giving.



 

 
  • What available financial resources can be converted to charitable assets to provide tax advantages in your clients' lifetime and estate? 
    • Cash, including a bonus or other cash windfall
    • Appreciated securities
    • Appreciated property—real estate, artwork, collectibles
    • Retirement accounts
    • Life insurance policies
    • Business interests
    • Hedge fund interests
    • Private equity
    • IPO stock
    • Restricted stock

 

  • Help your client choose one or more charitable giving tools. Commonly used giving tools include:
    • Charitable gift annuity
    • Charitable remainder trust
    • Charitable lead trust
    • Donor-advised fund
    • Private foundation
    • Community foundation
    • Direct giving

       
  • For charitable assets to be invested, determine a suitable asset allocation for your clients’ charitable assets based on their goals, time horizon, and risk tolerance. Low-cost investment options held for the long term will enable more money go to charity.
 
  • Review progress against goals.
  • Determine how often and how best to discuss—for example, during a holiday family dinner.
  • Evaluate charitable priorities annually.
  • Stay connected to chosen charities.


¹ The Heart of Wealth Management: Helping Clients Align Philanthropic and Financial Goals, State Street Global Advisors
² 2016 US Trust Study of High Net Worth Philanthropy