Planned Giving - Part 6 - Hull on Estate and Succession Planning #200
Listen to: Planned Giving – Part 6 – Hull on Estate and Succession Planning #200
This week on Hull on Estates Ian and Suzana continue their discussion on planned and charitable giving. Key quotes mentioned are from the book “The Art of Giving: Where the Soul Meets the Business Plan” by Charles Bronfman and Jeffrey Solomon.
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Ian M. Hull -Click here for more information on Ian Hull
Suzana Popovic-Montag - Click here for more information on Suzana Popovic-Montag
Welcome to
Suzana Popovic-Montag: Hi and welcome to Hull on Estate and Succession Planning. You’re listening to episode 200 of our podcast today.
Ian Hull: Hello Suzana.
Suzana Popovic-Montag: Hi there Ian. Congratulations!
Ian Hull: Yes, congratulations to you! 200.
Suzana Popovic-Montag: 200.
Ian Hull: Never thought we’d make it.
Suzana Popovic-Montag: That’s for sure.
Ian Hull: Boy, when we first started this.
Suzana Popovic-Montag: It’s amazing. I almost feel old but not quite.
Ian Hull: No, I’m sure you don’t because you’re not. But I remember, you know, if I look back although we’ll have to check for another day for…when we actually started this, what the first podcast date was. But anyway, we are at 200 – yahoo!
Suzana Popovic-Montag: Over 200 weeks, I’d say…I’d sort of guesstimate.
Ian Hull: I’m guessing, but I’ve missed the odd one but we haven’t podfaded which is always the worry. Alright, so back to philanthropy and charity and how we can better understand what that concept is about so that we can better give advice to our clients because too often it is just the old-fashioned sit-in-the-chair, the client’s across the desk from you and they come in and they say well, we’ve always thought we should give something back to the community. The lawyer, in the old days, used to be hey, well here are the three charities that I recommend, those charities with land in the world and that that’s your charitable donation. It wasn’t thought of during lifetime to give charity as much and it wasn’t thought of as to, you know, who you were gonna give to. So now we have a sophisticated charitable giver.
Suzana Popovic-Montag: And for those of you who may have missed our podcast last week, what Ian and I are discussing really is the book called “The Art of Giving”, which is a great book that Ian has introduced that’s written by Charles Bronfman and Jeffrey Solomon. So I highly recommend it to anyone who is interested in pursuing this in a little bit more in-depth.
Ian Hull: And to help me get inspired, which this book inspires. And we talked about it in the last podcast. There’s sort of four parts to the book. The first part talks about understanding who the donor is and what is a donor. And we talk about the concept that an individual…everyone has a little different way of dealing with charity. Impose a business model on that by saying well, let’s look at our customer and figure out that. The second part, which we’re gonna talk a little bit about today are who are partners in the process and who can you work with to help make an even more charitable impact. The third part is looking at the gift itself and looking at some of the practical implications of the gift itself, whether it’s going and serving the soup at the soup kitchen or whether it’s writing a cheque or whether it’s forming a group to have a fund-raiser, the different roles. And then finally setting out some resources. The book is full of great resources.
Suzana Popovic-Montag: That’s good.
Ian Hull: Now before we start into the partner’s part of it, let’s talk about what I think and I say I’ve got to come back to, is the Foreword by James Wolfensohn. I’m probably saying it wrong. A very prestigious man, a former president of the World Bank. A great quote from the book. He said this, he says “The big secret of philanthropy is now out through this book”. And he’s describing how much he loves the book. He says “Philanthropy is fun, it is joyful, it is fulfilling and it will make your life feel worthwhile in ways that few other enterprises can”. And if I can, as an advisor for my clients, impart that enthusiasm to philanthropy, then I think we’ve added new value to our relationship with our client. So it’s not just about mark down, and a great charity like the Heart & Stroke and give my residue or one-third of the residue to Heart & Stroke. We encourage that. But let’s add some life and fulfillment to the gift and the process.
Suzana Popovic-Montag: And that’s a really neat way of thinking about it, I think because it does add excitement to the process, as you say. And the truth is, you know, we’re seeing Estates that are much larger than they used to be even 5, 10 years ago. And so to be able to inspire people to do good for goodness sakes and yet feel really good about doing it as well, I think, is a nice little package.
Ian Hull: Well, funny you say that. That’s a good point that we are seeing more money and more transfer of the wealth is coming in. And so again, we need as service providers, need to be ready for that. And we need to, I think, push back a little bit on our clients in terms of what they’re gonna do. Are they just going to be cheque writers? Are they just gonna be deliverers of the charity? And some interesting statistics from the book. And I pulled them out of this book because often people like the nuggets and this book has some terrific statistics about some of the charitable giving. And they’re US-based numbers but let’s just talk about a few of those just to give a bit of a “wow” effect on charities.
Suzana Popovic-Montag: For sure. And just looking here at the statistics. The book tells us that there is 40 trillion dollars that is going to be passed down to the baby boomers from their parents and grandparents from the World War II generation. That’s 40 trillion dollars.
Ian Hull: And it goes on to say it’s 400 times this year’s military budget for the United States of America and 12 times the entire outlay of the federal government. You know, these are the kind of numbers that are staggering.
Suzana Popovic-Montag: They’re very surprising, frankly. There’s a 2007 record-breaking 306 billion dollars was made in charitable contributions.
Ian Hull: And about 74% of charitable contributions comes from individuals in the US.
Suzana Popovic-Montag: Just…it’s really hard to fathom that kind of money.
Ian Hull: But the one startling fact is that…what is it now, a majority of the givers make less than $100,000 a year.
Suzana Popovic-Montag: That is surprising.
Ian Hull: So you imagine how broad-based we’d have to keep, as a charity you have to keep your interest and your enthusiasm going.
Suzana Popovic-Montag: That’s true because the group of potential people who are going to fund these bequests…I mean, look at it. If they’re under $100,000, I mean, I find that really quite surprising.
Ian Hull: So it doesn’t surprise me to see guys like Charles Bronfman and Jeffrey Solomon writing a book of the business plan behind giving, because it…from a charitable standpoint, it requires a business efficacy approach to charitable giving. And if, as advisors, we can help with that because we’re gonna say here are different ways to gift. Here are different ways to motivate charitable giving and if you’ve got a son that doesn’t seem to be interested in X part of your business but really is a great deliverer of charitable giving, maybe what you’re doing is creating a foundation and employing him as the head of the foundation to deliver that charity.
Suzana Popovic-Montag: A very different kind of mechanism by which you can gift to people and share that…those resources that you have during your lifetime, I think.
Ian Hull: And that’s for the rich. But for the rest of us, the normal people, it is bringing real life to the effectiveness of the gift during your lifetime and after your lifetime. And so we really…and this book has helped sort of again give us some good clues on that. Again, we’ve learned about who the donor is. Now let’s talk about some of the partners. What does it mean…the whole second part of the book deals with partners in charitable giving.
Suzana Popovic-Montag: And I think there we’re looking sort of as the package deal, like who are the people who are part of all of this. And we’re…you know, we’re looking at financial planners. We’re looking at the investment advisors. We’re looking at the individual who’s actually going to be funding the money. The members of the family that are going to benefit from it. Those kinds of individuals.
Ian Hull: And organizing the partners, like any good business. Organizing your partnership and organizing the strengths and weaknesses around that, to help again bring life and enthusiasm. So as was said earlier, make philanthropy fun, joyful and fulfilling.
Suzana Popovic-Montag: And it’s funny because you’re pointing to a quote and the other one that sort of struck me as interesting was that if you can’t measure the impact of your gift, you shouldn’t actually make it. And just thought that seemed almost a little bit counter-intuitive when I thought about that.
Ian Hull: Well it’s a real struggle and I see it, the measurement of gifting and the measurement of giving as really a fundamental component of the book. And what we’ll do is in our next podcast talk about the measurements that the book has employed into it and talk about how we can start to see what does it mean to be the giver and the measurements in that regard. So again, thank you for making it to 200.
Suzana Popovic-Montag: Thank you very much .
Ian Hull: And thank you from the audience who have watched from time to time. Maybe not all 200 but we have all 200 on iTunes.
Suzana Popovic-Montag: Yes we do.
Ian Hull: Alright, thanks very much.
Suzana Popovic-Montag: Thank you. Bye-bye.
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