Adding philanthropic services to your portfolio can be a meaningful way to add value for your clients. While getting clients involved in charitable activities can be challenging, a strategic approach can help them meet their philanthropic goals while providing financial benefits.
Advisors can also help clients frame multigenerational conversations about giving. For example, it can benefit heirs, who are more likely to respond when the plan concerns something they feel strongly about.
Helping Your Clients Understand the Benefits of Charitable Giving
It could be time to begin if your clients still need to make charitable giving a part of their personal or business financial planning. The right financial advisor, like Kirk Chewning Cane Bay Partners, can help your client understand the benefits of donating to charity and create a customized plan that meets their needs.
Many clients are interested in giving because it gives them a sense of purpose and helps them feel good about themselves. For example, your client may be an entrepreneur passionate about a social cause or an impact investor looking to make a difference.
You can encourage them to explore a donor-advised fund (DAF) structure early. It will allow them to maximize tax advantages while focusing on legacy planning.
In addition, you can provide insight into how your client can grow their end-of-year charitable giving by donating long-term appreciated securities. It will help them avoid the dreaded tax penalty and maximize their charitable deductions.
Helping Your Clients Plan Their Charitable Activities
As an advisor, you’re the guardian of your client’s financial well-being. So, it’s no surprise that you are responsible for engaging clients in charitable giving.
A good philanthropic advisor will quickly understand their client’s charitable interests, values, and aspirations. Then, they can help your client identify opportunities to incorporate their philanthropic activities into their overall financial and estate planning strategy.
A savvy advisor often suggests charitable gifts that increase the client’s tax benefits. These include donating appreciated stock instead of cash, which can result in higher deductions and lower taxes, or establishing a private foundation.
The conversation can also lead to suggestions for creating a donor-advised fund or foundation, which your client can use to meet their philanthropic goals from now through retirement.
Including your clients’ children in the charitable discussion can ensure their charitable traditions continue and they understand their responsibilities to charities and the impact of their gifts. In addition, it can build trust and strengthen the relationship between you and your clients’ families.
Helping Your Clients Take a Proactive Approach to Charitable Giving
Charitable giving is an increasingly important aspect of your client’s financial and estate plans. A proactive approach that speaks to your client’s values, including philanthropic interests, builds deeper and richer relationships that enhance client loyalty and strengthen your service.
Throughout their lifetime, donors often consult several sources of advice on assembling a strategy for their philanthropy. These can include their existing financial advisors, peers, and online research tools.
But when developing a philanthropic strategy, it is also helpful for clients to think about the causes and organizations most meaningful to them. By creating a mission statement and understanding their motivations, clients can filter out donation requests that do not align with their philanthropic vision.
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