“When we cast our bread upon the waters, we can presume that someone downstream whose face we will never know will benefit from our action, as we who are downstream from another will profit from the grantor’s gift.”
Philanthropy – Creating a Legacy of Purpose
Family legacy is about more than just money – much more.
Why does philanthropy matter?
Family philanthropy provides a way in which a family can express its passion for helping others and encourages socially responsible behavior. It provides priceless fulfillment to the donors, and it’s one way important family values get passed down to future generations.
Involving and mentoring children and grandchildren in the family’s giving prepares these rising generations for the great responsibility that comes with having wealth. Multigenerational family meetings about social causes and value-based priorities to include in a philanthropic plan are a vital component in the successful transfer of wealth.
Philanthropy offers families a great way to educate younger generations about financial responsibility in a context of giving back. Successful families involve even the youngest children in these discussions. It allows them to become involved in a tangible family project that fosters their innate desire to help others. Younger generations learn that wealth is a tool with which they can actively make the world a better place.
Of course, in addition to these important intangible benefits, philanthropy provides families with much-needed tax breaks. Gifts to qualified charitable organizations typically entitle you to a charitable deduction against your income tax. Successful families can choose among several philanthropic options to enhance these tax breaks.
Philanthropic Planning for Thriving Families
At DMG, we help client families strategize, execute, and accomplish their philanthropic goals. This process takes place during scheduled family meetings that involve all family members. Our advisors have extensive experience in customizing activities that engage each individual based on his or her unique personality, skills, desires and experience.
When it comes to the tax benefits of philanthropy, too many people put tax savings ahead of the best interests of the family. They often focus on avoiding taxes with philanthropic actives, but don’t consider the impact the choice of vehicles (i.e. CRT, CAT, Family Foundations) could have on future generations. It’s these younger family members who will have to live with what could become a huge burden down the road.
It doesn’t have to be that way.
We’re knowledgeable about the many types of charitable structures and options available to maximize tax savings, and will work with tax advisors to develop a solution the whole family will love.
Families can use a philanthropic plan to inspire and enlighten all family members, create lasting legacies, protect assets from unnecessary taxation, prepare heirs for responsible wealth management, and act as a force for good by helping causes and communities they care about.