What Your Clients Really Want to Talk About

A new national study conducted by the U.S. Trust, Bank of America Private Wealth Management and The Philanthropic Initiative uncovers some important facts about high-net-worth individuals, their professional advisors and conversations about philanthropy.

Here are out top five takeaways:

Print1. Discussing philanthropic goals with your clients is a win-win for both sides.
Nearly one-third of HNW individuals (31%) indicate that they would be more likely to choose an advisor who is knowledgeable about charitable giving and three out of four advisors say that discussing philanthropy with clients is good for their business.
2. HNW clients say that what matters more than who initiates the philanthropic conversation is that it happen early in the relationship. Virtually all (90%) agree that this discussion should occur within the first several meetings with their advisor.
A recent Fidelity Charitable report found that not only do clients want to discuss charitable giving but they look to their financial advisors for advanced charitable strategies.
3. The use of giving vehicles is correlated with more advisor involvement – among HNW individuals, who discuss philanthropy with an advisor, 47% use one or more structured giving vehicles, such a donor-advised funds or private foundations, when making donations to charitable organizations.
“The Community Foundation brings unique expertise about community needs,” says Erin Stephenson, VP of Development. “Collaborating with professional advisors, who know their clients’ personal and financial goals and tax planning needs, results in deeper relationships and a stronger community.”
4. Although nearly half (45%) of HNW individuals feel it is important to involve children and grandchildren in discussions with their advisor about charitable giving, a mere 14% of advisors are likely to raise the topic of philanthropy with clients for the purpose of helping to instill charitable values among the next generation.
Donor and board member Kathryn Harbert says, “I work with the Community Foundation because I want Birmingham to be a vibrant community. I also want to show my children that they can be a part of the change in helping to make this an exciting place to build their future.”
5. Advisors estimate that 40% of HNW individuals would reduce their giving if the estate tax were eliminated. The study found that, in fact, that only 10% of HNW individuals cite reducing taxes among their primary motivations for giving.

Most high net worth donors derive great satisfaction and fulfillment from their giving. Donor Ken Jackson tells us that he has made a lot of charitable gifts in the past but setting up his fund at the Community Foundation and seeing his donation make a difference in the community has been the most fun he’s ever had.

If you would like more information about how to satisfy your clients’ desire to include philanthropy in their planning contact us. Erin Stephenson can meet with you one-on-one or with your team. They regularly give presentations to professional advisory firms about helping clients fulfill their philanthropic goals, and consults with advisors on specific client scenarios.

Click here: US_Trust_Study_of_the_Philanthropic_Conversation_2013 to read the full report.