Estate Planning, Building a Legacy and Talking to Your Clients about Naming Successor Advisors for Donor-Advised Funds

Your clients have worked hard to establish their charitable giving goals, and having a succession plan for their donor-advised funds is one way for them to pass those assets on to their heirs or charitable organizations. Many donors choose to involve their children and grandchildren in their giving, creating philanthropists for future generations. If charitable giving is a part of your client’s estate planning goals, have a conversation with them about donor-advised funds and the importance of naming successor advisors.

Naming Successor Advisors – Creating a Charitable Legacy

Naming a successor advisor is important. In addition to naming them, be sure to talk to your client about the importance of having conversations with their successors about their vision of giving. You want to work with your client to establish a plan that the successor advisors can execute. Having these conversations about the mission and vision of charitable giving and the role it plays is an important step in creating a charitable legacy.

• Your client may want to include the successor advisors in giving decisions today, so they are more invested in giving and more apt to carry on the tradition and legacy.
• When told in advance that a certain amount has been set aside for charitable giving instead of for taxes or as part of an inheritance, successor advisors have a greater understanding of those estate planning decisions.
• If parents are choosing children as successor advisors, it can become a way for families to carry on the legacy of their parents and honor their memories.

Periodically Evaluating Your Client’s Successor Advisors

It’s also a good idea to periodically ask your clients if their beneficiaries and successor advisors are up to date. Life stages, life events and other circumstances may trigger a need for evaluating goals and plans.

• The birth of a child or grandchild can affect the chosen successor advisors.
• Changes in goals and objectives of charitable giving organizations may also play a factor in determining if your client has the most up-to-date successor advisors.

Many advisors like to have these conversations with their clients every three to four years to ensure they have the most accurate information.

Talking to Clients About Family Philanthropic Goals

Clients expect their financial advisors to play an important role in their charitable giving plans. Having a conversation around giving will help you learn about your clients’ values, goals and passions.

• It’s important to ask your clients to express their charitable giving priorities.
• If successor advisors are chosen, getting them involved in these conversations can identify competing goals and opinions.
• Top goals can be used to create a family philanthropic mission and help guide strategies.
• Families can also create a strategic giving roadmap to ensure that their charitable giving legacy lasts for multiple generations.

Engaging in philanthropy with family can be one of the most meaningful experiences with your client.

Have Conversations With Clients With Multi-Generational Giving Goals

Which clients should advisors begin having these conversations with about donor-advised funds and identifying successor advisors? It’s important to look for characteristics about their investing and giving strategies that can organically lead to these conversations.

• Clients who have started to talk with you about multi-generational participation in philanthropy.
• Clients who give to multiple charities.
• Clients who own multi-generational family businesses.
• Clients who have expressed interest in actively involving the family in philanthropy discussions.

Donor-advised funds make it easy to help your clients who are passionate about continuing to support their favorite charities as a part of their ongoing legacy. When working with your clients, it’s important to help them understand how this can contribute to a legacy of giving.

By discussing charitable goals with your clients, you can help them increase their impact and leave a lasting legacy. Along the way, you deepen your relationship with them as you encourage them to talk about their values and priorities. Legacy and family tradition inspire and strengthen family philanthropy, and often motivate family members who choose to participate.

Contact us for additional resources and tools to help you maximize your clients’ giving.