Strategic Philanthropy Process

Planned Giving Worksheet

The Impact of Social Investing On the Next Generation

The concept of ‘social investing’ is not new. We have seen many versions of this over the years, starting with what was also called ‘ethical’ investing, where people chose not to invest in companies that sold tobacco or other such products. 

Dennis Jaffee and Josh Cohen look at social investing from a different perspective. They know that often children growing up in affluent families face unique challenges. One of these is creating a personal identity of their own. How could they possibly ever ‘outsize’ the achievements of the prior generations. 

In this article, Dennis and Josh introduce the concept of getting young adults involved with investing some of the family wealth in order to have a social impact the young adult feels passionate about. 

I often have discussions with people about how best to engage their children with their philanthropy while also helping to launch them into the real world. The approach of investing with a social impact may be appropriate for some of you.

Many people that I work with feel that if they have a current will completed, their estate plan is organized. While having  a current will completed is crucial, there is much more that you can do to make sure your estate is organized.

This “Green Box Exercise” is a process I have found helpful. The idea is that you have one place that all the information on the following check list is stored. It may be a safety deposit box, or a locked cabinet in your home. The Green Box is just a metaphor to define a storage place that is safe and that your loved ones and/or key advisors have access to.

Part of the intent of this exercise is to provide direction to your executors on how you would want your affairs handled in your own words. Yes, the will does provide the legal wording, but a letter in  your own words to explain ‘the why’ behind what you are doing will go a long way to helping communicate your key decisions more effectively.

If you are a business owner, do you need an emergency plan for your business as well? If you died today, would your business survive you? Who is left in charge tomorrow? What will your banker do? Who has the authority to make the necessary decisions tomorrow to make sure your business does not suffer? These are big decisions. Having a business emergency plan process in place and documented will go a long way to assisting your company and your executors.

The Green Box Exercise

A common theme for many of my clients is concern around how to prepare children for wealth. Whether your children are adults or toddlers, this causes a great deal of stress. I had the good fortune of attending a workshop that Dr. Dennis Jaffe Ph.D co-facilitated.  A key learning for me was that parents think once all of the very technical aspects of a wealth plan are in place, we feel our job is done.  Dennis explains in this article that the plan is only a beginning.  How we work with our children (young or old) to prepare them to deal with wealth is just as important as any legal document that is designed to help make sure their wealth is protected.  Jaffe provides 7 practical tips on the subject. 

I hope you enjoy the article.

Pat

Secrets of Responsible Parenting – By Dennis T. Jaffe, PhD

Dr. Grubman is a clinical psychologist who works with some of North America’s most affluent families, helping them to negotiate the many unique challenges wealth poses for the family. This article is one I found very interesting. Dr. Grubman et al describe the dynamics within affluent families. The perspectives of a person who grew up around wealth versus the person that is new to wealth are very different. Acknowledging and understanding these differences can be the first step to more effective communication within a family. As Dr. Grubman assures us, wealth and life can be integrated successfully in families and this article is a great starting point for improved communication within the family.

Immigration To The Land of Wealth

James Hughes is a lawyer who has facilitated multi-generational family meetings for the past 30 years. Hughes places special emphasis on mission and governance issues. In his article, Hughes makes a key point about wealth:  financial wealth is not the only type of wealth in a family. Families need to acknowledge the human and intellectual wealth that also exist in order to preserve the real wealth of the family into the fifth generation and beyond.  If you enjoy this article, Hughes  book “Family Wealth Transfer” also provides some excellent tools and tips for affluent families to consider.

James Hughes Article

This is a tool that I have developed to assist my clients as they are preparing their wills. The standard will states that in the event both parents die , after expenses and taxes, the remaining residue estate should be divided equally among the children.  As people become more affluent I believe strongly that this default position should be reviewed.  The question you need to ask is, “ What is an appropriate inheritance to leave my children?”.  When an estate is worth $2,000,000 it may be fine to leave 3 children equal shares. However, if the estate is now worth $20,000,000 is 3 equal shares still appropriate? This worksheet will help you answer that question. Going through this exercise often results in a more well thought out will, and often leads to making charitable bequests a part of the estate plan.

How Much Is Enough (worksheet)