Clients and goals: Why staying asset-savvy matters

You're advising your clients about their retirement goals, their goals for supporting their children and grandchildren, and their goals for the legacy they intend to leave to the community causes they care most about.

In all of the planning work you're doing for clients, you know assets matter to achieving goals. This is certainly the case in philanthropy planning. How many of your clients are still supporting their favorite causes with cash gifts? That's not tax efficient, as you know.

If your clients are holding highly-appreciated assets, such as stock or real estate, and they are planning to make a significant gift to charity, consider advising them to give the appreciated assets instead of cash. Assets like appreciated stock can be sold by the charity for 100 cents on the dollar--no capital gains tax applies. That means the charity ends up with more money to work with than the client would if the client had sold that same asset. 

You have a responsibility to advise your clients about the best charitable giving vehicles to meet their goals. Frequently, a donor-advised fund at the Community Foundation is the best solution. (There is a reason donor-advised funds are growing three times faster than private foundations!)

If your client wants to support several charities all at once but has a single large asset that would be perfect to contribute, encourage your client to consider using a donor-advised fund to facilitate the contributions. The client can transfer the asset to the fund, get the tax benefits, have the asset converted to cash, and then allocate the proceeds to several different charities of the client's choice. The proceeds can even be held in an endowment fund to ensure long-term support of a favorite cause, or used to create an unrestricted fund in the client's name managed by the Community Foundation to support the community's greatest needs now and in the future. 

Be sure to think outside the box. Sometimes even artwork, jewelry, antiques, limited edition books, and other collections can be contributed to a donor-advised fund with excellent results for your client and the community.

Your Community Foundation team can help you structure the best philanthropy plan for your clients, their families, and the communities they love. 

Staying on trend: Why the donor-advised fund is a vehicle you need to know

The relatively new donor-advised funds are not only here to stay, but the wave of the philanthropic future .... Love it or hate it, the philanthropic revolution is on, and donor-advised funds are winning.
— Los Angeles Times, March 13, 2014

Assets in donor-advised funds totaled $110 billion in 2017. From these vehicles were distributed $19.08 billion in grants, according to the National Philanthropic Trust. Also in 2017, people donated $29.23 billion to donor-advised funds.

Donor-advised funds are popular because they allow an individual or family to make a tax-deductible transfer that qualifies as a charitable contribution, and then later recommend gifts to favorite charities from the fund when the time is right. A donor-advised fund operates a lot like a checking or savings account just for charity, and it’s established according to the IRS guidelines that create the tax advantages.

How can you connect this trend to your work with your clients? Here are three pointers.

1. Talk the talk.

Your clients are hearing about donor-advised funds. Make sure they are hearing about them from you! Whether your clients support a few charities or many charities each year, a donor-advised fund is a useful tool. Furthermore, the tax advantages set the donor-advised fund apart from other vehicles. Your clients will expect you to be knowledgeable. 

2. Know the options.

Donor-advised funds are available through a variety of providers. Community foundations are uniquely positioned to offer donor-advised funds with the inherent tax and transactional benefits you and your clients expect, plus the added advantage of deep community knowledge and a well-connected team of experts to enrich your clients' experience with philanthropy. 

3. Walk the walk.

Consider establishing your own donor-advised fund with the Community Foundation. In today's social impact culture, clients want to work with well-rounded professionals who are connected to well-respected community institutions. The team at the Community Foundation would be honored to work with you and your family to meet your own charitable giving objectives. We're always looking for donor stories to share with others, too, so keep that in mind as an option to celebrate our work together. 


Along with this article, consider offering the following links to credible third-party sources to reinforce your knowledge of philanthropic planning and connections to experts across the country. For example:

A free white paper generously made available by the legal experts who presented at the National Conference on Philanthropic Planning in 2016.

An article in Trusts & Estates Magazine outlining the advantages of using both donor-advised funds and private foundations in philanthropic planning.

A free white paper about the various ways a charitable remainder trust can be used in philanthropic planning.



Teaming up with your clients: Why social impact personality type matters

Each of us has our own approach to “doing good.” Each of us leans toward one of three Social Impact Personality Types: Investor, Activator, or Connector.

You'll realize it's a lot easier to help your clients with philanthropy if you know which type they are, or at least make an educated guess. That's because the charitable giving styles of each type are different. As you work with your Community Foundation on building philanthropy plans for your clients, be sure to let the Community Foundation team know your assessment of your clients' Social Impact Personality Types. It will help the Community Foundation work with you to deliver outstanding service to your clients.

Social Impact Personality Types

  • Investors prefer to engage in social impact activities that are independent and do not require scheduling dedicated time or working directly with others in the pursuit of a charitable endeavor.

  • Connectors prefer to engage in social impact activities that are social in nature, involving the opportunity to get together with others.

  • Activators are passionate about participating in the causes they care most about, and they tend to focus on “changing the world” and impacting one or more social issues on a broad scale.

A Few Clues to Determine Type


What an Activator says about giving:

  • “I want to be sure the dollars I am giving are making a real difference. I want to see impact.”

  • “I always devote the majority of my annual giving budget to supporting charities that are working to solve large-scale social issues.”

  • “My giving dollars will make a bigger difference if I am personally involved in a charity’s programs. That’s the only way I can tell if my money is actually helping people in need.”

Four Giving Activities Activators Enjoy

  1. Giving an increasing amount of money each year to a favorite charity based on the organization’s demonstrated results to improve the quality of life for the people or causes it serves.

  2. Giving money to three different charities collaborating to achieve a specific goal, such as increasing the graduation rate within a particular school, discovering new drugs to treat cancer, or rebuilding a community center in a blighted neighborhood.

  3. Giving to disaster-relief efforts after a hurricane, tornado, or earthquake.

  4. Giving money to charities with the condition that the charity report back on the results achieved with the money (e.g., 100 meals were served to homebound seniors).


What a Connector says about giving:

  • “You never know when you might be at a point in your life where you need help from a charity. It’s important for people both to give to, and receive from, each other.”

  • “It makes my day to get a thank you note from a charity promptly after I send a check.”

  • “Some of my best friends are the people who work at the charities I support.”

Four Giving Activities Connectors Enjoy

  1. Hand-delivering checks to charities as an opportunity to say “hello” and “thank you” to the people working so hard to improve the lives of others.

  2. Giving money to a best friend’s favorite charity.

  3. Collaborating with family members during the holidays to make one big gift to a single charity instead of many small gifts to different charities.

  4. Encouraging children to add money to a piggy bank designated for charity and then mailing the money to the charity in an envelope with pictures drawn by the kids, or giving online with a credit card and emailing the pictures.


What an Investor says about giving:

  • “I always check out a charity’s financials before I write a check by going online to GuideStar and looking at the charity’s Form 990.”

  • “Our family considers gifts to charity as part of our overall investment portfolio. We are investing back into the community that has allowed us to be so successful.”

  • “Maximizing the charitable deductions available under the Internal Revenue Code for giving to charity is the big win-win in philanthropy.”

Four Giving Activities Investors Enjoy

  1. Structuring an estate plan to include several bequests to favorite charities.

  2. Giving appreciated stock to a charity instead of cash, to minimize capital gains tax exposure.

  3. Setting up a donor-advised fund to organize annual giving to charities.

  4. Establishing a budget at the beginning of the year to include a percentage of income designated for gifts to charity.


Embolden has created educational materials on the topic of Social Impact Personality Type. Check out the free ebook on our website. With your purchase of the Second Edition Content Capsules, you are welcome to make this resource available to your donors and advisors on your website, too, at no extra charge.