How a Donor Advised Fund helped establish a generational philanthropic legacy
The Family Snapshot
Martha, a widowed 84-year-old matriarch, has a large family of four children and twelve grandchildren. Under her financial advisor’s guidance, she established a Donor Advised Fund (DAF) valued at $900,000 and decided to use it as a tool to instill values of philanthropy and responsible stewardship in family, particularly her grandchildren. Twice a year, she arranges a family meeting with her children, grandchildren, and financial advisor to discuss their charitable goals and distribute funds.
Family Meetings – Key Component in Building a Lasting Legacy
At a family meeting every February, Martha allocates a specific – age-appropriate – amount of money to each of her grandchildren aged 8 and older. Their task is to research and recommend a grant to a charity each has chosen. This exercise encourages them to explore causes they are passionate about and instills a deeper meaning of the importance of charitable giving.
Six months later, in August, the grandchildren must present their chosen charity to the family. Traditionally, they explain their choices using research to strengthen their decisions. During a recent August meeting, Martha introduced a twist which added an element of creativity and fun.
A Most Memorable August Meeting
At this August meeting, attended by the financial advisor, Martha gathered her family and explained that the presentations would be done differently this year. Instead of speaking, the grandchildren were to act out their charity choices in a “charades” fashion, allowing the family to guess the charity based on their performances.
One of the grandchildren, a 12-year-old girl – let’s call her Sarah – embraced the challenge with great enthusiasm. She returned to her room, took the top sheet off the bed, and unscrewed the light bulb from the nightstand. When her turn to present came around, she stood on a plastic milk crate, wrapped herself in the sheet, and held the light bulb aloft.
With the financial advisor as “master of ceremony,” the guessing game commenced. All the children, including those younger than eight, eagerly participated. After several attempts, one of the grandchildren correctly guessed her chosen charity: The Statue of Liberty Foundation. Sarah then explained that her interest was sparked by a desire to learn more about the experiences of arriving immigrants and their journey to America.
A Philanthropic Legacy with Family at Its Core
The financial advisor seized the moment to emphasize the significance of this exercise – pointing out the grandchildren would one day be as old as their grandmother, and would always cherish the memories of these meetings, as well as the lessons learned about philanthropy and family values.
Martha’s face lit up with pride and joy as she witnessed her grandchildren engage so deeply with the process. It was evident that she was leaving a remarkable legacy, not just through her charitable contributions, but also through the values and experiences she was imparting to her family.
The Advisor’s Role as Guide, Advocate, and Champion
By facilitating these family meetings and guiding the discussion around their Donor Advised Fund, the family’s financial advisor earned the loyalty and trust of Martha’s children and grandchildren as well as playing a crucial role in stewarding the success of their family legacy. This story highlights the powerful impact that the financial advisor can have in preparing heirs for responsible stewardship, strengthening relationships, and fostering a culture of giving within a family.
In summary, Martha’s innovative use of her Donor Advised Fund serves as a powerful example of how financial advisors can help clients create lasting legacies that extend far beyond monetary value. By engaging future generations in meaningful philanthropic activities, advisors can strengthen family bonds, instill important values, and secure long-term client relationships.
For a complimentary guide, authored by Phil Tobin, iGiftFund Founder/Chairman, the foremost authority on DAFs, click here: The One Page Legacy Plan.
The One Page Legacy Plan complements financial, accounting and legal expertise,bringing a value-added philanthropic dimension to the relationship with your client and the client’s next generations, who will manage inherited wealth.
This is Part 3 of a 3-part series on The Great Wealth Transfer, elaborating on the benefits of Donor Advised Funds to financial advisors and their clients.
Follow this link to read Part 1.
Follow this link to read Part 2.
A Note from iGiftFund Founder and Chairman, Phil Tobin:
I am happy, as is the iGiftFund team, to answer questions and discuss ways to use DAFs in your practice to mutually benefit both you and your clients.
iGiftFund prides itself on the same personal relationships that financial advisors value with their clients. In that spirit, iGiftFund does not operate a call center. When you call iGiftFund, rest assured a real person will take your call and answer your questions, or direct you to an iGiftFund principal, representing the longest DAF experience in the industry. Additionally, your clients will appreciate knowing that they will save 25 to 30%, or more, in administrative fees vs. fees of the large national DAF sponsors.
If you are a financial advisor wanting to learn more about Donor Advised Funds and iGiftFund, please feel free to contact us at your convenience.
800-800-0366
Phil Tobin
Founder/Chairman
iGiftFund