Skip navigation
Planning for Family Philanthropy

Planning for Family Philanthropy

Along with directly helping your client with their wealth management planning, you can also help them initiate charitable giving conversations with their families and create a plan for family philanthropy. In fact, studies have shown that when advisors discuss philanthropy and social capital management strategies with their clients and their clients' children, the attrition rates of next generation clients moving their assets to other firms drops by 50% in the U.S.


Think about how you discuss philanthropy and charity with your family. Growing up in my family the act of charity was a modeled behaviour, even if it wasn’t discussed outright. Because we never actually articulated charitable giving until I was older, I think there were some missed opportunities around having an open dialogue with my parents around how they donate their money. Don't get me wrong, my family is very generous with their time and their financial resources, it was just never discussed outright.


One of my earliest childhood memories was putting loose change in what we call a pushke (Yiddish for coin box). Once the box was full we would take it to the community centre where the money would go to one of many Jewish charities in Calgary or Israel.


As I got older, my own personal contributions to community broadened. Supporting organizations' internal capacity is just as important to me as supporting a specific project. As well, recognizing that my cultural community is only one part of a larger picture, my philanthropy is a representation of all the communities that I am actively engaged with.


Facilitating the discussion with your clients can be tricky as philanthropy is an emotional experience tied up in a financial transaction. Because of its very nature, it is important to ask questions; questions of the charity in which your client is about to make a financial investment AND questions of clients and their families as to how they want to make those donations. Below are some more that you might want to ask your client as you delve deeper into philanthropic investing.


Their Past:

  • What was your first charitable donation? What was your first major donation (a dollar amount that you had to really think about)?
  • How did your family discuss charity in your house? Was it action-based?
  • What has been your most important charitable investment? When did you make it? What made it important? Was it your most important charitable gift your largest?
  • How did you make your financial wealth? Has that influenced you in how you contribute back to your community?


Societal Influencers:

  • As someone who has financial resources, do you think it is your responsibility to support community initiatives?
  • How do you leverage your charitable dollars with your family, friends and colleagues? Do you?
  • Is it important to you that your contribution (whether time, money or professional expertise) be recognized publicly?


The Future:

  • If money were not an object, is there a project or organization you would invest in?
  • How do you think your charitable contributions are going to change over time? Are you speaking with your children about how you give and learning from them how they are contributing back to society?


Another way to get the giving conversation started within families is by having them create a family mission statement or a social vision statement, and integrating social capital into it. A family mission statement is the one thing that directs how your client makes their decisions as family.


Creating a family mission statement gets them to complete the following sentences:


  • The values that inform my giving are...
  • I want to (state what you want to do with your time, treasures and talents) to further (what purpose, social issue or area of interest)...
  • The organizations (specific agencies or types of agencies) that I want to engage with are...


The process for completing these statements goes into the deeper questions around their social vision.


The family mission statement should be revisited annually. It is a living statement of who they are and as their family changes so too should their mission.


Some questions to further the conversation around a family mission:


  • Do you have a family mission statement?
  • How effectively is your family mission statement directing the decisions you are making around community participation (volunteering, donating resources, or attending events)?
  • What did your conversation look like when you were setting up this mission statement? Was it a conscious discussion, or something that has evolved over time?
  • How many generations are involved in your family mission? Have you figured out how you will engage the next generation?


On a larger scale, incorporating charitable giving strategies into family wealth planning early can have an impact down the road when it comes to estate planning.


I strongly advise that your clients not let money be the elephant in the room. They can start the conversation of money by leading by example. Family should be engaged in major financial decisions. Just like the African adage about teaching a man to fish... If one provides their children and other family members with the tools to make sound financial decisions they will use those tools.


As Randy Ottinger states in Beyond Success, "If the discussion of values beyond money has not been a part of the dialogue between parents and children at a young age, then money will often become the perceived goal for personal success."



Gena Rotstein is the CEO of Dexterity Ventures Inc., which creates technology solutions and tools to help advisors talk to clients about their philanthropy and social capital questions. Follow her on Twitter @DexterityCon.