You have $1 million to give. What would you do?
Many people shy away from planned giving thinking, “I’m not old enough,” or “I don’t have an estate,” or “There’s plenty of time for that.” If you have a house, a retirement plan, a life insurance policy — you have an estate. Thoughtful charitable gift planning ensures your role in shaping the future. I’m a big fan of philanthropist Tracy Gary’s book, Inspired Philanthropy.* Gary walks you through the reasons and process of creating a giving plan with impact. I love to share with people her work and how simple and meaningful creating an effective plan can be.
First, think about your values, because that’s what philanthropy is — an expression of values. Author and fundraising expert Si Seymour said, “Giving is prompted emotionally, and then rationalized. The heart has to prompt the mind to go where logic points the way.” I couldn’t agree more.
If it’s been a while since you’ve thought about your values, it helps to answer a few questions, like: What experiences and people have been key in shaping your core values and passions? With what have you been troubled? What brings you joy? What is your heart saying?
- What experiences and people have been key in shaping your core values and passions?
- What do you notice about your values when you consider your choices, such as life directions, career, free time, lifestyle, donations and spending?
- When you hear of world events or witness an injustice, what moves you most?
- With what have you been troubled?
- What keeps you up at night?
- With what have you been most delighted?
- What brings you joy?
Getting back in touch with your values will make you feel pretty good. But it gets even better. Now you get to dream a little, and do some visioning. From your list of values outline some key issues that you care about. Think of a problem or need you would really like to help resolve. People often think of homelessness, access to healthcare, conservation, or access to education as examples.
Now imagine that you have just been given $1 million to give away or invest in solving that problem or meeting that need. No strings attached. What would you do? Let your values and the issues you care about guide your ideas. What stirs your heart? It probably feels easier to imagine all this with a hypothetical million dollars on the table. But hold on to the ideas that come to you, because you don’t need a million dollars to practice inspired philanthropy.
- Who would you convene or hire to support your efforts?
- What institutional partners would you choose?
- What outcomes would you hope for in what time frame?
- How would you be involved to maximize impact?
- How would you share your vision with others?
- What is holding you back from starting some of this work, even without $1 million?
For those of you who are more likely to lead with your head as opposed to your heart, another way to think about putting together your plan is “Four Ps”. First is people — who you want to take care of (children, aging parents, students, the homeless, etc.). Second is property — what assets you have to work with (savings, a retirement plan, real estate, a life insurance policy). Third is plan — the goals you want to accomplish or problem you want to solve (a secure retirement, providing arts education for kids). Fourth is partners — who will help you implement your ideas. This one is important. Estate attorneys, financial planners, the donee organization, etc., are critical in making sure what you want to happen really happens.
Often, people get held back by one of three barriers to effective giving: Informational, emotional or strategic. Things like a lack of information about organizations and activities to get involved in, lack of confidence that you can make a difference, or not knowing how to get started — these are hurdles ready to be jumped by inspired philanthropists, and the visioning exercise will help you get over the hurdles.
- Informational – Lack of information about organizations and activities you might get involved in.
- Emotional – Lack of confidence as a donor, volunteer or activist; that you can make a difference.
- Strategic – Lack of the time, focus or support that would help you push through the other barriers.
What does a giving plan do for you? Among other things, it enables you to be thoughtful and purposeful in your action and gives you a pathway into the future.
- Gives you a chance to express yourself and your passion as well as your goals and reasons for giving.
- Enables thoughtful and purposeful action.
- Allows you to take care of future needs.
- Fosters more enjoyment, integrity and effectiveness than automatic, reactive giving.
- Has benefits, even transforming power, for both the giver and the receiver.
Thoughtful giving plans (including estate planning) are not, surprisingly, a one-time task, but an ongoing process. Here are a few things to keep in mind while you get started:
- Is an ongoing process, not a one-time event.
- Identifies your goals (perpetuating a legacy, minimizing taxes, providing for family).
- Identifies your beneficiaries (to whom do you want to make gifts).
- Identifies your assets (cash, appreciated securities, appreciated property, retirement accounts, life insurance).
- Determines your liquidity needs (the amount of money you need to live on now and in the future, including emergency expenses).
- Helps you organize your records.
- Ensures your wishes are carried out.
- Creates a plan that has the impact that fulfills your goals.
And I hope you pick up Gary’s book. There are so many rewards in return.
Laura C. Simic is vice president for advancement at Boise State University.
*Gary, Tracy. Inspired Philanthropy. Your Step-by-Step Guide to Creating a Giving Plan and Leaving a Legacy. Third Edition. Jossey-Bass. 2008.