Many successful people feel the need to ‘pay it forward’ by financially supporting organizations that mean something to them.
You may already make regular and sizable charitable donations. But have you ever considered getting your family involved? If the answer is no, you may be missing out on a teaching opportunity with your children and loved ones about smart family philanthropy.
Gather the Kids Around
Most people’s deepest financial concerns are focused on taking care of their family and making sure that they are financially secure and positioned to enjoy a stable life.
Family philanthropy is a great way to ensure this. In our newsletter, Five Reasons to Make Philanthropy a Family Affair, we discuss ways to engage your family in charitable giving to build character and strengthen meaningful relationships. We want to give you the first one to start you off on the right foot:
“Working together to define your shared values around wealth, building community and contributing to various socioeconomic statuses – Family Mission Statement”
When deciding how to involve your family, you should take into consideration ages and maturity levels. You can still include the younger children on a broader level while the older children have more say in the decision-making process.
Family Philanthropy Approaches
One way to enter into family philanthropy is by developing a private foundation. As a not-for-profit organization, assets in a private foundation provide income, which support the operation of the foundation and also assist in making charitable grants to other non-profit organizations.
One reason a family may move to a private foundation is:
Legacy – Many people create private foundations to honor loved ones. Foundations are effective in binding a family together around something they consider meaningful. You should probably build a legacy – of one kind or another – if you choose to create a private foundation.
Other important reasons for establishing a private foundation can be found in our newsletter. However operating a private foundation can be complicated and call for a variety of experts to manage the details.
Wealthier families consider private foundations over a more common used charitable giving tool – the donor-advised fund (DAF) because of two reasons: control and creating a legacy. We dive into these reasons and why these affect the decision-making process for family philanthropy in our newsletter.
Read below, or download as a PDFfive-reasons-to-make-philanthropy-a-family-affair
Subscribe to Harvesting Prosperity
Financial Harvest Wealth Advisors Team
The Financial Harvest Wealth Advisory team is dedicated to helping address the unique financial planning needs of each family, business, or individual that we have the privilege to serve. Our team members are focused on client success and helping our clients realize their most significant and meaningful life goals.