Maximising Your Philanthropic Impact:
Financial Planning for Giving
By integrating philanthropic goals into your financial plan and exploring various giving strategies and investment options, you can maximise the impact of your charitable contributions while achieving your personal financial objectives.
At our firm, the notion of giving back isn't just a concept; it's a heartfelt desire shared by many of our clients. Oftentimes, the catalyst for this desire arises when they receive an inheritance, embark on retirement planning, or engage in estate planning where they wish to leave a lasting legacy.
For us, philanthropy isn't merely a transactional act; it's a profound expression of empathy and responsibility, shared by numerous individuals we have the privilege to serve.
This shared desire to give back often finds its roots in pivotal moments of financial reflection and planning. Whether it's the receipt of an unexpected inheritance, the contemplation of retirement, or the meticulous structuring of one's estate, these junctures frequently spark a profound introspection about one's legacy and impact on society. It's in these moments that our clients begin to recognise the potential they have to leave a lasting imprint, not just in the lives of their loved ones, but in the broader community and causes they hold dear.
Recent Successful Case: Tom's Tribute to His Late Mother
Let me share with you a recent case that exemplifies the power of philanthropy in action. Our client, Tom, approached us with a heartfelt desire to honor his late mother, a dedicated nurse. He wished to donate $100,000 to the healthcare sector as a tribute to her legacy.
Initially, Tim envisioned donating the entire sum as a one-time lump sum. However, we explored alternative options together, considering that if he wanted to create a lasting legacy for his mother, a single lump sum might not fulfill his objective.
After careful deliberation, we decided on investing the $100,000 in guaranteed fixed-term annuities. These annuities would provide a guaranteed regular income for a fixed term, ensuring a steady stream of support for the healthcare sector. In Tom's case, the annuity would provide $10,000 annually for ten years.
Tom's inspiration stemmed from his mother's profound impact as a nurse, both in her professional life and during her final days in the care of compassionate nurses. With this in mind, he aimed to establish a foundation that would support the work of future nurses.
Upon finalising the plan for utilising the donation funds, our next step was to identify an organisation aligned with Tom's vision. Through collaborative efforts with the head of philanthropy at a local university and a professor of nursing, we outlined how the donation could be utilised, its contribution to the nursing sector, and avenues for communication to inspire others to follow suit.
The university will organise an annual grant to be offered to nursing students each year with a commitment to provide this grant over the agreed ten year period. They also have offered to write a tribute to Tom's mother and share her story.
This is a win-win for everyone involved.
How to Work With Us to Plan Your Giving
Below I share Phillips Wealth Partners approach to giving which may be of interest:
- Setting Giving Goals: Determine the amount of money you wish to allocate for charitable giving, ensuring that philanthropy remains a priority in your financial plan.
- Choosing Charitable Causes: Research and identify causes or organisations that align with your values and interests, whether it's education, healthcare, environmental conservation, social justice, or community development.
- Developing a Giving Strategy: Decide how to distribute your donations among different causes or organisations, considering whether you prefer one-time gifts, recurring donations, or a structured giving plan.
- Tax Planning: Understand the tax implications of charitable giving to maximise the impact of your donations, consulting with financial advisors or tax professionals for guidance.
- Investing for Impact: Explore impact investing opportunities to generate both financial returns and social or environmental benefits, such as socially responsible mutual funds or impact-focused businesses.
- Creating Donor-Advised Funds: Consider establishing donor-advised funds for flexibility and tax advantages, allowing you to recommend grants to qualified charities over time.
- Establishing Charitable Trusts: Explore estate planning tools like charitable remainder trusts or charitable lead trusts to support charitable causes while providing financial benefits for yourself or your heirs.
Reference: Funds You Can Support - University of Canberra
Written by Luisa Capezio