Advisors represent a unique strategic resource. As the trusted experts who have a professional responsibility to safeguard and grow their clients’ assets and structure their estates, advisors have deep insight into their clients’ overall net worth, something that charities rarely, if ever, achieve.
Advisors who manage large assets under management and numerous high net-worth families can bring millions of dollars to charities that might otherwise never access this pool of potential gifts.
“Successful Investment Advisors will be managing the financial affairs of 100 to 500 families who look to them for advice on overall asset allocation and on specific investments,” notes Michael Shain, Vice-President & Wealth Advisor with BMO Nesbitt Burns.
With this kind of far-reaching influence, charities will want to be top of mind when potential donors and their advisors are engaged in the philanthropic discussion. Positioning your charity as a resource is important, as advisors are often amenable to make referrals to other resources of philanthropic expertise and counsel as needed.
Creative, strategic giving vehicles
Gifts that involve advisors are diverse and creative, including strategic giving vehicles such as charitable remainder trusts; gifts of RRSPs and RRIFs; private company shares; and gifts of insurance.
Recently, a donor called me after a visit to her financial advisor. She told me that she was making a gift to my organization through her estate. Her advisor structured it so that the income from her RRIF will be used to purchase a life insurance policy designating our charity and her family as split beneficiaries.
She was excited to tell me the outcome of this approach: our organization will be getting a large legacy and her children will be inheriting double what they would have inherited had the charitable component been absent.
From the donor’s perspective this was a purely advisor-driven gift. However, it would never have happened if I hadn’t previously developed a relationship with her advisor and discussed specific, innovative gifting options like this one.
Are advisors a fit for your charity?
As you assess your internal resources, be aware that developing a network of professional advisors is high-maintenance and time consuming. You will need to:
In my professional experience, if your charity has the personnel and resources to manage the load, the rewards are potentially bountiful and well worth the effort.
Having worked with advisors as a fundraiser for over 12 years, I deal with numerous donors who are referred to me through their advisor.
Over the last three years, gifts received by my organization, with the assistance of advisors, have surpassed $18 million in the form of endowment funds and planned gifts. A significant portion of these gifts arose because my organization has invested in the development of a successful and active division geared exclusively to the advisory sector.
In conclusion
Donors are turning to their trusted advisors for guidance on structuring their donations and legacy-planning strategies in a manner that integrates seamlessly into their overall estate planning.
Indeed, perhaps never before in the history of our business have fundraisers been so ideally positioned to benefit from the crosscurrents of dramatic transformations in giving patterns, an unprecedented transfer of wealth, and the critical role that advisors will play in these trends moving forward.
Born and raised in Harare, Zimbabwe, Janice Benatar has also lived in South Africa and Israel, and now makes her home in Toronto. She has been involved in a number of fundraising initiatives, specializing in endowments, planned giving, capital campaigns and working strategically with professional advisors. Janice is a Certified Fund Raising Executive and currently works as Senior Development Officer for the Jewish Foundation of Greater Toronto and the Tomorrow Campaign of UJA Federation. Contact her JBenatar@ujafed.org.
