The Ultimate ‘Gift Giving’ Opportunity:
The holidays offer the perfect time to develop a legacy of compassion
by Paul Nourigat

Throughout the holiday season, there’s a natural opportunity to create a powerful family bond through a very special common thread. The compassion for others, through sharing of one’s assets, offers this common thread and is a recurring theme which a family can rally around in a fun and meaningful way, year after year. Such a bond can be a saving grace as cultural, personal and economic forces are fragmenting many families’ connectedness.

For most, giving to others is non-strategic, whether it’s to charitable organizations or passers-by asking for help. People often give out of a sense of guilt and/or obligation; while it feels good to help, such gifts often lack the deep satisfaction which comes from thoughtful deliberation and the alignment of gifts with ones preferred causes. When parents make gifts to charities, kids rarely learn of the rationale, selection process, or the potential impact of these gifts. Consider a new tradition of a family meeting, which offers the opportunity to collaborate on a family mission of effective giving, every year from this point forward.

A “meeting” may sound a bit stuffy, but the process does not need to be over-complicated. In essence, by engaging the whole family in a thoughtful discussion about the potential recipients of your family’s gift(s), each member can chime in with their opinion. As kids mature to teens and then adults, their involvement can evolve as well, including the decision around their charities of choice and how to apportion the family’s gifts. In our family, as our kids have matured, they are able to direct their portion of our family’s gift fund to a charity of their choosing. While my wife and I do not discuss the amount of the gift fund, I suspect we will someday, as they mature further.

For some families, financial gifts are less feasible but time is plentiful, so the family can rally around a volunteer effort instead of cash gifts. Meals-On-Wheels deliveries, volunteering at a school event, or collecting unneeded garments for Dress-For-Success clients are a few of the countless examples of charitable acts which a family can support. Thousands of nonprofits and important community causes need volunteer support, thus the gift of labor can be a lifeline in efficiently putting others’ financial gifts to work. The key is that such an effort is accomplished together and that the choices are open for discussion, the delivery is a mutual effort, and the impact is visible to all family members.

The trap is to just “write the check”, or serve a role on your own, thus diminishing the teaching moments and collaborative opportunities which can create a tradition and form a legacy of giving which can be passed on for generations. Here’s my recommended simple process to build this family bond:

• Consider your capacity to give, with money and/or time, and set a annual gifting budget for your family. Remember, as your family builds a strong financial position, it will be positioned to give more. As all charitable requests feel intriguing, setting a budget assures your family’s broader needs are also honored.
• Throughout the year, place charitable marketing pieces, interesting articles, and ideas in a dedicated file for later review and reflection.
• Avoid spur of the moment decisions around commitments, instead allowing your family time to reflect on the many important causes and effects of your gifts.
• As the holidays approach, sort through various possibilities and select 5-10 which you feel are most worthy of family consideration. These may follow a family “theme”, such as helping youth in need, or be varied to engage family members to a greater degree as they may feel very differently from other family members about what is most important.
• Sit down as a family and review each charity and cause, providing the family with a brief overview to each organization, who it helps and how it helps.
• Get each family member’s input on what they feel strongly about, who they would most like to help and why they feel that way. This is an incredible opportunity to see how family members views differ, while offering them a platform to share their feelings in an open forum; encourage equitable participation.
• Decide together on the percentage of your funds or time which will be allocated to the chosen causes, assuring that each persons’ voice is heard and they feel the respect of the family in expressing their view and directing resources.
• Consider the tax benefit of making the gifts prior to year end, potentially offering a tax benefit within the present year.
• Share the impact. As you may receive letters of thanks from the charities, or have the opportunity to deliver something personally, engage the kids in this as well. This makes the concept real and deepens the pleasure of sharing, while humbling all involved through the recognition of their good fortune.

When a family’s financial resources are more plentiful, establishing an entity in which to place funds for gifting can formalize the family’s intent, while providing tax advantages which expand the capacity to give. Charitable funds, charitable trusts, and family foundations are not just for billionaires, as everyday Americans increasingly establish such gifting entities; the vast collective wealth of these entities are expected to drive profound improvements in the quality of life for the balance of this century.

Regardless of the sophistication of your giving or the extent of your gifts, engaging the family in the process builds a tradition which the family will anticipate. Charity and compassion are incredibly personal topics, with a great variety of opinions and approaches, yet, no one can argue with the great need in our society. The good feeling and common bond which come from helping others can build a legacy which becomes the greatest asset on your family’s balance sheet.

Paul Nourigat is a leading national consultant and senior wealth strategist for US Bank’s Private Client Reserve. He has consulted with thousands of corporate leaders and families regarding their financial management, family financial dynamics, and company succession planning. Nourigat is the author of nine financial success books; his newest, “No Time To Wander: the financial compass for young Americans”, guides adults in their twenties and thirties to financial freedom, candidly addressing difficult economics, life complexities, and the common gap in financial skills.