When it comes to discussions about charity, Zaneilia Harris doesn't wait.
The president of Harris and Harris Wealth Management Group, in Upper Marlboro, Md., launches discussions about charitable giving in her initial meetings with clients. She asks each family member about their charitable giving preferences, and specifically asks which charities each person views as his or her passion. "I find out what is important to them," says Harris.
These meetings are not just for Harris's benefit. Yes, she gains valuable information about her clients' charitable goals, but the meeting also informs family members about each others' values and expectations when it comes to philanthropy. Harris insists on details: "We discuss amounts and timetables," she says. She holds these discussions even if the clients cannot imagine having the resources to make significant charitable contributions until much further in the future.
If and when it becomes appropriate for the family to make donations, Harris says her foundational discussions help reduce conflicts between family members about where to give. If disputes still arise, Harris retrieves the notes from the initial meetings to help everyone understand what had been discussed earlier.
Harris also presents compromises, such as suggesting the family give on a biannual and alternating basis to each spouse's preferred charity. Or she may recommend the family split the total donations 50-50 among each spouse's preferred charity.
If those proposals fail to settle family differences, Harris may turn to a donor-advised fund, as does David Adams of David Adams Wealth Group, a Nashville-based Raymond James affiliate. Adams has suggested a donor-advised fund when he's been faced with clients who either want to make a charitable donation or need to for tax reasons, but cannot—after hours of discussion—decide where to give.
Setting up a donor-advised fund doesn't eliminate the discord, of course. But the clients will still get the tax advantage for the current year, and they have the luxury of time in determining exactly where they'll make their charitable contributions. "You can give away that money at another point. You can't take it back though," warns Adams. Adams has even established his own donor-advised fund, to which he contributes on a yearly basis. He taps that fund when clients ask him to make charitable contributions.
Miriam Rozen, a Financial Planning contributing writer, is a staff reporter at Texas Lawyer in Dallas.
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