Tag: charitable giving

Giving Thanks + Giving Back

Published in: Resources |

Thanksgiving week is upon us once more! Turkey, stuffing, mashed potatoes, and, most importantly, an attitude of gratitude. While Black Friday deals have been the talk of the town in years past, in recent years, the push to give instead of buy has arguably been even greater. With Giving Tuesday falling right after Thanksgiving, it’s the perfect opportunity for advisors and other financial professionals to talk with clients about year-end charitable donations.

While Giving Tuesday is about more than just money — it can be anything from making a stranger smile, to helping someone in need, to showing up for a cause that’s important to you — fiscal donations are a fantastic way to make a positive impact on an organization that you care about, as well as in the greater community. (And it doesn’t hurt that charitable giving often offers tax breaks!)

If you’ve been considering a year-end charitable gift, here are a few strategies to consider that can help you make the most of your money.

  1. Establish a Donor-Advised Fund

A donor-advised fund (DAF) is a charitable giving account that allows the donor to make a gift and qualify for a charitable deduction immediately, without needing to decide straight away which charity or charities they’d like to support. Additionally, the money deposited into a DAF can grow tax-free until the donor is ready to recommend a grant.

  1. Give long-term appreciated securities

Contributing stocks, bonds, or mutual funds that have appreciated over time to philanthropic organizations is another method of charitable giving that has recently gained popularity. For starters, based on a handful of requirements and limitations, publicly traded securities and other types of securities may be tax deductible, with the amount deducted in a single year being up to 30% of the donor’s adjusted gross income. Additionally, gifting shares of company stock can help to diversify a donor’s portfolio.

  1. Donate complex assets

Another option is to donate complex and illiquid assets directly to charity. These include real estate, restricted stock, private company stock, and even cryptocurrency. Although these types of donations often require additional time and legal advice, they have a relatively low cost basis, which many donors find appealing.

  1. Consider a bunching strategy

The “bunching” strategy is about maximizing the impact of a donor’s itemized deductions by concentrating deductions in a single year, followed by one or several skipped years. Bunching can work well when a donor’s total itemized deductions for a single year fall below the standard deduction, as contributions for multiple years made at once may exceed the standard deduction and allow for a tax break. Of course, it’s worth noting that this strategy requires the donor to have a significant financial capacity.

Give Back With The Humphreys Group

As a reminder, the deadline for year-end charitable giving for 2021 is Friday, December 31, while the last day for 2021 grant recommendations from DAFs is Tuesday, December 28.

If you’re considering making a year-end gift but are feeling a bit uncertain about the best avenue for you, please don’t hesitate to reach out and schedule a phone call or meeting. Whether you’d like to learn more about the various options for charitable year-end giving or have an in-depth discussion about the strategy that fits best into your overall financial plan, our door is open.

And, of course, Happy Thanksgiving!

 

How to Make the Most of Your Charitable Gifts, Emotionally and Financially

Published in: Resources |

It’s that time of the year again.

Once the clock strikes midnight on Halloween, many businesses go full holiday mode:

Suddenly, you’re inundated with joyful Christmas music — in every store, in every restaurant, during every cab ride. Holiday lights envelop the trees, your office building, your entire neighborhood. Commercials on the radio and letters in the mail urge you to donate to their charities. Family members text you insisting for your holiday wish list. And to top it off, you can’t seem to escape the never-ending stream of holiday movies about the joy of giving.

If this somewhat insincere push for joy, cheeriness and gratitude from organizations, media, family and friends makes you feel overwhelmed, anxious and/or guilty, you’re not alone. Giving — whether it’s financial or nonfinancial — can bring up a lot of uncomfortable emotions. For instance, you might feel:

  • guilty when you are gifted money, unexpected gifts, opportunities or someone’s time;
  • stressed when being expected to keep up with your family’s giving traditions;
  • annoyed about not knowing where your donation dollars are going at a charity;
  • or ashamed when you can’t give as much as you want to a charity.

At The Humphreys Group, what we have seen is that when our money and values are out of alignment, we are less happy, less conscious of and less engaged with our own financial management. So how can we make sure that our values and giving are in harmony? We can’t accomplish everything in a blog post, but here are a few steps you can take:

Assess how you feel about receiving.

Think back to a time when you received something. It can be money, opportunity, an object or someone’s time. What was that memory and how did you feel about it at the time? You might not realize it, but our ability to give is in large part determined by our ability to receive. It’s important to understand how we feel about receiving generosity because this often affects how we feel about giving. As researcher Brené Brown says in her book The Gifts of Imperfection, “Until we can receive with an open heart, we’re never really giving with an open heart. When we attach judgment to receiving help, we knowingly or unknowingly attach judgment to giving help.”

Think about how your family handled giving.

Your family home is where your roots of giving reside — even if you work hard today to operate from a different set of values and behaviors. Looking back to your childhood, what do you remember learning about giving? What habits and money messages around giving (and receiving) have you inherited from your family? What examples or what kinds of giving can you recall? Generosity can take on many forms:

  • Was there generosity among family members? Gift giving or exchanges of favors?
  • Was there a tradition of taking in wayward cousins or stray animals?
  • Were childhood friends invited to dinner?
  • Was there money to pay for grandchildren’s college?
  • Was there tradition of helping strangers or volunteering?
  • Can you think of an example of an enjoyable giving experience you had? Why did it feel good?
  • Now, what did you discover about how your own giving practices are similar or different from your parents?
  • What do you think motivated your parents to give and how is that similar or different from what motivates you?

Not all giving comes from generosity; some comes from guilt, obligation, need or even anger. Even giving to your very favorite charity can feel fraught. If we give too much, our financial foundation can become shaky. If we give for the wrong reasons, our financial landscape may become clouded with resentment, neediness, expectation or disappointment.

Reflect on where you might stop, start or continue giving.

  • Who or what are you currently giving to that you are happy with? Don’t forget things like caring for your mother, taking care of the neighbor’s kids, tutoring a child, handling the fundraising for the football team or being available to a friend that’s having a hard time.
  • Have you had a giving experience that was challenging, that turn out well, or caused conflicts?
  • What kinds of giving would you like to increase and where would you like to trim? If you feel you are giving too much of your time, perhaps you have more tangible things to give. Or, if you are feeling like you are writing too many checks, maybe you’ll find giving time is more rewarding.

Research the organization you’re giving to.

Rating sites like Guidestar.org, CharityNavigator.org or the Better Business Bureau’s Wise Giving Alliance assess criteria such as how transparent a nonprofit is about its finances and how much of its budget goes toward programs. The organization you’re giving to should be able to provide information and documentation to confirm it’s a registered 501(c)(3), according to CNBC. You can also use the tax-exempt organization search tool on the IRS website.

Other financial steps you can take:

As well as asking yourself these questions and researching the charities you’re giving to, there are also several strategies you can do to ensure your charitable giving dollars go farther for both you and the charity. Some year-end strategies for charitable giving include:

  • bunching your donations;
  • donating appreciated stock instead of cash;
  • using a donor-advised fund;
  • making a qualified charitable distribution from an IRA;
  • and investing in a charitable gift annuity.

Creating intention around your giving.

In the days coming up to the holidays, give yourself time to reflect on these questions and create intention around your giving going forward.

At The Humphreys Group, we also make sure to ask ourselves these questions. We often make contributions to nonprofit organizations on behalf of our clients to celebrate milestones in their lives, in addition to making an annual year-end holiday donation in honor of all our clients. The organization we choose reflects our vision and values, and our commitment to women’s issues. Past recipients have included She’s the First, Girls Who Code, The Girl Scouts of Northern California, San Francisco Safe House and Raphael House.

If you’re interested in learning more about how to emotionally and financially make the most out of your charitable giving, contact us today.

Understanding the Relationship between Gender and Philanthropy

Published in: Resources |

Women are making strides in charitable giving. What’s equally exciting is that they are doing it on their terms, in ways that are helping to reimagine and redefine their place and participation in the world of philanthropy.

Notable highlights from a 2016 Fidelity Charitable study of 3,254 “millennials” (born 1980-2000) and “Baby Boomers” (born 1946-64)* explored a variety of different behaviors and outlooks between the two generations, but also found that women of both generations shared several traits that differed from their male counterparts. When it comes to giving, women in both age groups:

  • View giving as a key part of their lives and are more likely to do it
  • Lead giving and volunteering efforts within their families and among their networks
  • Are more spontaneous, engaged and emphatic about their giving
  • Seek more information, and do so more often, about tax strategies and benefits related to giving
  • Prefer to be informed by experts rather than peers or family members
  • Exhibit more confidence than men when it comes to budgeting for giving, determining the causes they wish to support, and specifying amounts to give to those causes

*(Note: those born between 1965-1979, or “Generation X,” were not included in the study.)

Researchers from the Women’s Philanthropy Institute at Indiana University-Indianapolis, which has long examined gender as it relates to giving patterns, behaviors and satisfaction, also acknowledge women’s growing influence and power in philanthropy. This may be due, in part, to overall growth in female incomes, wealth and education levels; this growth has enabled more women to become increasingly interested in, informed about and involved with giving. That’s a trend that seems to be ongoing, with more research about it to come — in fact, it’s worth noting that their most recent study focuses on the intersection of race, giving and gender.

While we’re pleased about this positive outlook, we also realize that beginning to engage in charitable giving may feel like a daunting endeavor. We agree with other experts who say that taking some strategic first steps toward increasing one’s knowledge, confidence and participation in philanthropy can be empowering.

Women who want to commit to becoming donors should consider:

  • Researching the causes, organizations and/or initiatives that interest them, align with their values, and may stand out as priorities for their charitable giving funds.
  • Creating a “philanthropy budget” by earmarking specific amounts or assets, including cash, savings or monthly bank deduction(s), to contribute toward philanthropy.
  • Speaking with an investment professional to review charitable giving basics such as where, when, how much and what kinds of giving to begin with. An experienced advisor can also provide information about the tax ramifications of giving.

The future of women’s involvement in philanthropy is a bright one filled with fresh possibilities, and we welcome the opportunity to explore that future with you. Contact us today to discuss how we can help make charitable giving a part of your overall financial planning strategy.