Get more out of your charitable giving

Wilson-150-x-150Thomas K.R. Wilson, CFA, Managing Director, Wealth Advisory

Typically, when we think about giving to charity, we think of all the lives we enrich by our support. What we sometimes overlook is how great it feels to do good.

As Elizabeth Dunn and Michael Norton explain in their book, Happy Money: The Science of Smarter Spending, “Giving and happiness are mutually reinforcing, creating a positive feedback loop.”

Covering a broad spectrum of research studies, Dunn and Norton demonstrate how those who enjoy the emotional benefits of giving feel good about themselves and tend to behave more generously in the future. They also explain that those who give to others feel wealthier than those who do not make donations, and when prosocial spending is done right, even small gifts can increase happiness.

The best way to make sure you get the most emotional benefit out of your charitable giving is simple: make your gifts about you.

YOUR choice

Reaching into your pocket when you feel backed into a corner does not strike the pleasure centers in the brain as much as when you open your wallet because you felt compelled out of a sense of purpose to do so.

Part of YOUR big picture

Next to saving for retirement and college, charitable giving is one of the top financial priorities for many American families. It has earned a seat at the financial and estate planning table along with other financial goals, yet many people overlook philanthropy when setting and prioritizing financial goals.

When you make charitable giving part of your larger financial and estate plan, you can be assured that your generosity does not negatively impact any of your other financial goals and that you gain all applicable tax benefits.

Speak to who YOU are as a person

The charitable contributions you make should reflect your most deeply held values and beliefs. Before you write your next check to charity, stop to clarify your beliefs and preferences. Do you want to end hunger, fight domestic abuse, spur economic development in your community, or eradicate cancer? Think about where you want to make an impact globally, nationally, or locally. Do you want to give to many or few? Make a list of the top three to five causes that speak to your soul. The smaller the list, the more focused your giving, and the better you will feel.

Parameters set by YOU

If you are like many other givers, you don’t know how much you’ve given to charity until tax time. By establishing a charitable budget each year, you can make better decisions about funding levels for individual causes and initiatives. With the changes brought about by the Tax Cuts and Job Act, you should speak to your accountant about having your charitable donations distributed via RMDs or see if bundling your donations are right for you.

Organizations YOU trust

Whenever you make a donation,  it is a good idea to verify that the charity is legitimate and is capable of making an impact and fulfilling its mission. You can find information about a not-for-profit’s tax-exempt status, mission, and finances at Charity Navigator, Wise Giving Alliance, or Guidestar.

Make the impact YOU want

If you don’t specify how you want your gift to be used, the not-for-profit organization will likely spend the money on their top funding priorities. In some, but not all instances, the organization’s top funding priorities align with your interests. You can, however, make a restricted gift. In doing so, you earmark your dollars to serve a specific purpose, spelled out clearly by you in a written letter of instruction.

For 30 years, Brinker Capital has served financial advisors and their clients by providing the highest quality investment manager due diligence, asset allocation, portfolio construction, and client communication services. Brinker Capital Wealth Advisory works with business owners, individual investors, and institutions with at least $2 million. To learn more about the services available through Brinker Capital Wealth Advisory, call us at 800.333.4573.

The views expressed are those of Brinker Capital. Brinker Capital does not provide tax, legal, or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal, or accounting advice. You should consult your own tax, legal, and accounting advisors before engaging in any transaction. 

Brinker Capital, Inc., a registered investment advisor.

Building the team for the business owner: Picking your first partner

Coyne_HeadshotJohn Coyne, Vice Chairman

Last week, we hosted a terrific webinar with Andrew Haas, a senior estate planning partner at Blank Rome, a major Philadelphia-based national law firm. Over 100 financial advisors throughout the country signed on to participate.

It dawned on me as I listened to Andrew that when building a team for a business owner client, financial advisors should align first with an estate planning attorney. Why? Because together, not only can you help business owners understand how their life will be after the sale of the business, advisors can help business owners recognize their own mortality.

My friend, Dan Prisciotta of Lincoln Financial, has a line in his excellent book, One Way Out, which is about helping business owners exit their business for the highest possible value. In the book, Dan says, “Your exit is 100% guaranteed whether you go out vertically or horizontally.”

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The role of the partnership is to help business owners maximize the value of their business so they can enjoy the fruits of their labor and secure their legacy after they are gone. The estate planning lawyer is the bucket of ice water that can wake the business owner up to the reality that poor preparation of the exit plan will have a direct impact on how their family and heirs will live their lives after they are gone.

An estate plan coupled with a financial plan prepared by you reflects an exciting and reasonably predictable future after exit. You have helped them take the first step in letting you build their team. The key to a great partnership is transparency. By having both the financial plan and estate plan fully understood by all parties, as these are both living documents and will evolve over time, you can keep everyone’s eyes on the target of a successful exit.

We want to help advisors help their business owner clients live the life they’ve worked for. The way to begin the process may lie with helping them understand life after they’re gone.

To help decide which estate planning attorney is appropriate, you may consider engaging in some of the services that are offered through investment management firms such as Brinker Capital that have relationships with a wide array of organizations. Brinker Capital Wealth Advisory works with business owners, individual investors and institutions with assets of at least $2 million and has partnerships with firms that can assist with the estate needs of business owners.

To learn more about Brinker Capital, a 30-year old firm following a disciplined, multi-asset class approach to building portfolios, and an overview of the services available through Wealth Advisory, click here.

Have a safe and enjoyable Independence Day weekend!

The views expressed are those of Brinker Capital and are not intended as investment advice or recommendation. For informational purposes only. Brinker Capital, Inc., a Registered Investment Advisor.