Discussions about charitable giving are also a way for an advisor to cement his or her relationship with the next generation, says Kathy Nalywajko, principal at 1919 Investment Counsel, an asset management firm with offices in New York, Philadelphia and elsewhere.
“The person we usually talk with is the matriarch or the patriarch, but we talk about how the next generation will handle money. Talking about charitable goals is a way to bond with the next generation” for both the older family members and the advisor.
Jeffrey J. Huizenga, relationship manager, and Patrick J. Smarjesse, vice president, at David Vaughan Investments in Peoria, Ill., note that a firm’s charitable work can also have the side benefit of helping to build the firm’s brand.
“Philanthropy is built into the culture of our firm. We feel we need to be good members of our community, so we sponsor events and community activities,” says Smarjesse.
“This dovetails naturally with cash flow planning and retirement planning for our clients,” adds Huizenga. “As clients have to take required minimum distributions, giving to charity may be a good way to do that and get a tax advantage.”
“But our experience has been that the charity comes first, then the tax considerations,” says Smarjesse.