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Help Clients Plan for a More-Rewarding Year of Charitable Giving

Reevaluating past donations and setting goals for the future are key.

Did your clients enjoy giving to charities last year? Or do they groan (and feel guilty about groaning) just at the suggestion of doing it again in 2019? If yes, it’s time to revisit why, where and how they’re giving. 

Here’s how your clients can get more from their giving this year:

Audit Their Giving 

Have clients review their canceled checks and donation receipts to remind themselves what causes they supported last year. Then have them ask themselves why they gave. Did they give to their alma mater out of habit or attend a local charity gala because they felt pressured to go? How did they feel after making these gifts? If they’re missing out on “the joy of giving,” perhaps old acquaintance should be forgot! This year, instead of giving exclusively to the same old causes and organizations, clients can focus on an issue that has real meaning for them—a depredation that moves them to tears, an injustice that infuriates them, or art that delights and stirs their soul. 

Set Personal Goals

Yes, giving helps other people. But one of the secrets to transforming your clients’ giving is to advise them to be a little selfish. Think about what they want to achieve with their giving—for themselves. Do they want to enlarge their circle of personal and business relationships? How about involving their family, so that they spend time together doing something positive on weekends? If they’re retired, they can even pursue philanthropy as a “second career,” leveraging their skills, life experiences and contacts for an important cause. By prioritizing their personal satisfaction, a client’s giving will be more enjoyable and sustainable.  

Power Up Their Giving

Clients can boost the impact of donations by giving to successful nonprofits and by multiplying their charitable funds. Here’s how:

Make sure donations are used effectively. After making a donation, clients should check back to see if it was spent wisely. One way to do so is by getting metrics from the nonprofits they support and looking for tangible evidence that they’re meeting their goals.

Establish a charitable vehicle. If a client is looking to donate tax-inefficient assets, neglecting to track donations or rushing to donate at year-end, recommend starting a donor-advised fund or a private foundation. Both vehicles enable a client to take a tax deduction in the years he contributes assets, both enable the contributed assets to grow in a tax-advantaged environment, and neither requires he donate money immediately. The bottom line: Clients will have more funds to give and more time to plan where their donations will do the most good. 

Increase support without giving more money. Suggest that a client move his money from a traditional bank to a community bank or credit union to use his money for good without giving more of it away. For example, if he gave $10,000 last year to charity and had $100,000 on deposit at a traditional bank, his “do good” contribution was $10,000. However, if he was to move that $100,000 to a community bank or credit union, he could put $110,000 in service to his community. Rather than lending the money on deposit to outside corporations (as most banks do), community banks invest it locally through loans for affordable housing projects, home mortgages in low-income areas and new businesses.

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