Community
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Navigating a Generational Transfer of Values
Some parents see family philanthropy as a way to ensure family values are carried forward, but the next generation may feel it’s simply an obligation. Patrick Fletcher is a Senior Planner in the Wealth Planning Group at D.A. Davidson. He has witnessed this kind of disconnect in families. With tools and training from the Chartered Advisor in Philanthropy (CAP) Program, he is dedicated to guiding families in identifying shared values that foster a thriving community.
“Unfortunately for the next generation, family philanthropy can sometimes feel like a burden of inheritance, without control or personal connection.” Patrick Fletcher shared the challenges he has helped families resolve in a recent conversation with Greater Tacoma Community Foundation.
Patrick Fletcher, Senior Planner, Wealth Planning Group, D.A. Davidson
Patrick often finds himself closer in age to the younger generation of families he advises. That personal connection is an opportunity for next-generation clients to have candid conversations regarding their personal values, aspirations, and generational differences. He has observed a common dynamic among those inheriting wealth and philanthropic resources, “They want to honor their parents’ wishes while also seeking independence in their philanthropic choices. It’s a delicate balance between interdependence and independence.”
I witnessed their enthusiasm grow. They started crafting proposals for charities and proactively engaging with their communities.
Patrick worked with one family whose parents developed a philanthropic mission statement focused on supporting their church and causes aligned with its values. However, not all of the children shared the same values which, “led to a situation where year-end discussions about philanthropy felt rushed and obligatory, rather than meaningful. A lack of communication between generations (neither side is at fault because we all know communication is a two-way street) led the parents to assume that the kids were not interested in philanthropy.” This could not have been farther from the truth.
In his role, Patrick facilitated family conversations, sometimes one-on-one, sometimes as a group, to explore individual values and motivations. “While it was challenging, the process was incredibly rewarding as I witnessed their enthusiasm grow. They started crafting proposals for charities and proactively engaging with their communities.” Ultimately, the family reached a consensus plan that allocated a portion of their giving to shared values, while allowing the younger generation to support causes they were passionate about.
Like many professional advisors, Patrick’s philanthropic discussions center on financial matters, primarily focus on tax mitigation. “That is where it typically started in the past. However, the CAP program has broadened my perspective, allowing me to explore the emotive aspects of philanthropy.”
CHARTERED ADVISOR IN PHILANTHROPY
CAP is the Chartered Advisor in Philanthropy program through The American College of Financial Services. It focuses on how clients and donors can use financial planning, estate planning, and gift planning to advance their personal financial goals for self and family, while also having a positive impact on their community. GTCF hosts cohorts of professionals through the CAP certification program.
Steve Saalfeld, GTCF Philanthropy Advisor
Steve Saalfeld, GTCF Philanthropy Advisor, sees CAP resources help many professionals expand their expertise and confidence around the philanthropic conversation, “Philanthropy transforms communities, but it can be daunting for families and their advisors to learn to use the tools in a way that fits into their vision and family dynamics. With CAP, a lot of people discover some simple processes that can support positive conversations and joyful decisions. And the aligned professionals we work with understand that philanthropic advising isn’t just ‘a nice thing to offer’ clients but something that research shows will lead to more assets under management and higher client satisfaction.”
GIVING IT AWAY VS. SUPPORTING WHAT YOU CARE ABOUT
A tension around the purpose of philanthropy surfaced during Patrick’s work with another family. “Two siblings had different perspectives on their family’s wealth and philanthropy following the passing of their father. One sibling, who had actively participated in philanthropic efforts with their mother, including the support of community resources such as public libraries, viewed their role in family wealth transfer as a ‘stewardship of values and community enrichment’. In contrast, the other sibling who was less involved with their mother’s charitable giving, felt that their responsibility as a steward of wealth was to maximize financial resources preserved for future generations.”
By focusing on shared values, families can come together and create a meaningful legacy.
During an estate planning discussion, Patrick encouraged the second sibling to consider his sibling’s perspective, “You have more than enough wealth, and estate taxes are inevitable. The key is to find ways to support causes that resonate with your interests. For instance, consider initiatives that preserve the landscapes where you and your family engage in your preferred hobbies, or provide opportunities for youth to develop your passion for said hobby, when they would have otherwise written off the experience due to financial constraints.” This conversation helped shift the sibling’s understanding of philanthropy, emphasizing that it doesn’t have to revolve solely around large organizations or following in the footsteps of those before them. “They realized they could align their passions with their philanthropic efforts. This newfound freedom allowed them to support causes they genuinely care about, moving away from the perception of ‘just giving it away’.”
For Patrick, the journey of helping families transfer values alongside wealth comes down to establishing the ‘why’ before developing a plan, “It is essential to create an impactful strategy, rather than simply responding to requests for donations (responsive philanthropy). By focusing on shared values, families can come together and create a meaningful legacy.”
LEARN MORE ABOUT BUILDING FAMILY PHILANTHROPY WITH THE SUPPORT OF A GTCF PHILANTHROPY ADVISOR. GTCF CAN ALSO PROVIDE TOOLS AND RESOURCES FOR PROFESSIONAL ADVISORS. START BY EMAILING FASERVICES@GTCF.ORG.