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Advisor Perspective: How Do you Approach Charitable Giving with your Clients?

By Kevin Hegedus, Financial Planner, Prairie Wealth Management, and Saskatoon Community Foundation Donor

Estate planning can be one of the most difficult and emotional discussions for clients and their family members alike. Which is why the relationship between financial advisors and their clients can be a crucial component to the Estate Planning process. It is not uncommon for advisors to assume multiple roles over the lifetime of their advisor/client relationship: celebrating life events, helping plan for the future, being the voice of reason when making investment decisions, and ultimately becoming a compassionate confidante helping clients with some of the most important financial decisions of their lives. Knowing clients on this personal level, and understanding their individual situations and personalities, creates a comfortable environment where they are relaxed and therefore willing to openly discuss their most intimate final wishes.

Over the course of these open discussions, most financial planners will suggest charitable giving as a tax minimization strategy, and most clients are emotionally moved by this idea and motivated financially by the opportunity to optimize tax efficiency within their plan. They typically want to know how to approach the decision while ensuring that their wishes for immediate family members, and their own financial concerns remain secured.

The best way for clients to accomplish this is by working with skilled professionals such as Certified Financial Planners, Chartered Accountants, and organizations such as the SCF. Financial  professionals will determine if there is an opportunity for charitable giving and, if so, advise clients on how best to give, and how much to give within their plan. This team will develop solutions and strategies to ensure that a clients’ years of hard work building wealth and assets, are transferred to beneficiaries as tax efficiently as possible.

Family members will often assist throughout this process, particularly when named as executor of the will. By including them, it provides peace of mind to the family knowing that the financial affairs are in order and helps them to fully understand the final wishes of the client.  Nonetheless, for most family members, planning for the death of a close relative can be a painful experience, yet when charitable giving is incorporated into the plan, it can create a deep sense of pride and accomplishment for both the client and their families. The knowledge that they have contributed in some way to the improvement of life for those most in need of help and generosity within their community, is a legacy most of us would be honored to leave behind.

When finalizing an Estate Plan which incorporates charitable gifting, some clients will have an organization that comes to mind right away due to past experiences or life events; others, may be uncertain of the charity best suited for them. The SCF is a valuable resource for advisors and their clients in this situation. They provide an effortless solution for clients when seeking out recipients for their donation. The SCF utilizes their skills and knowledge to deliver long-term meaningful contributions to the community as whole maximizing dollars gifted by benefactors. Working alongside the SCF allows Financial Advisors to be experts in the field of financial planning, while providing clients access to SCF experts in the field of charitable giving.

A balanced blend of professionals and open family discussions can create legacies that live on forever, not only in the stories and lives of family members and descendants, but also in the localcommunity organizations named in the estate plan.

(Promise Magazine 2016)