The art of giving to create a positive impact on society is a "dynamic journey," the author of this commentary argues.

The following article, which explores the journey that many philanthropists go on, opens up discussion points that HNW clients of wealth advisors should take on board. This news service regularly examines the area of philanthropy, for example the challenges that philanthropy advisors themselves face.

The author of this article is John Weeks, managing director, family wealth and business transition planning at The Colony Group. The editors of this news service are pleased to share this content; the usual editorial disclaimers apply to views of guest writers. If you wish to jump into the conversation, email tom.burroughes@wealthbriefing.com

Wealth management isn’t just about numbers on a balance sheet. To guide clients effectively you need to know where their heart is. And one way to find out is to talk to them about philanthropy. 

Philanthropy, the art of giving to create a positive impact on society, is a dynamic journey. The life arc of a philanthropist is a representation of how philanthropic engagement increases over time, passing through stages as life events inform and motivate actions. By recognizing which stage your client is in, you can get a better idea of their personal values while helping them integrate philanthropy into their financial plan.

1. Checkbook philanthropy – “The friendly ask”
At the inception of their philanthropic journey, many individuals start with checkbook philanthropy. Think of the times you ordered Girl Scout cookies, wrote a check for a fundraising neighbor or gave to the charity collecting donations outside the supermarket. The birth of a child, an inheritance or even a mail solicitation can trigger a reactive, in-the-moment decision to give. 

2. Reciprocal philanthropy – “You give to mine, I’ll give to yours”
Reciprocal philanthropy occurs when philanthropists from within the same social and professional networks support each other’s causes. Examples include asking a colleague to support you in a bike-a-thon fundraiser for cancer research and their reciprocal ask of you to buy a ticket to a ‘gala’ event benefiting the arts. Linked together by the act of collaboration and the shared commitment to a common goal of “greater giving,” reciprocal philanthropists can facilitate increased collaboration, resource sharing, and a broader impact on societal issues. 

3. “Connect to a cause” philanthropy – life event brings focus
In the "connect to a cause" stage, philanthropists develop a deep and emotional connection to a specific mission, like an alma mater or a local religious institution. Personal experiences or witnessing significant life events, such as a natural disaster or a loved one's health conditions, can become a catalyst for individuals to strive to create a more profound impact.

4. Philanthropy at work – connecting with employees and community
Philanthropy at work happens when giving is integrated with one's professional life. Examples include corporate social responsibility programs, workplace giving campaigns and employee volunteerism. A career change, promotion or the acquisition of a business can lead philanthropists to leverage their professional platform for social good. 

5. Personal involvement philanthropy: Volunteer; serve on a board; chair a committee
As philanthropists gain a deeper understanding of the issues they care about, they often become actively engaged in the initiatives they support. Within our client base, for example, we have a client who sits on a local hospital board and leads fundraising campaigns, while another partnered with a women’s shelter to build a transition home in memory of his mother. A profound personal awakening or life-altering experience can propel individuals toward personal involvement philanthropy. 

6. Family engagement philanthropy – a transfer agent for family values
Family engagement philanthropy is centered on the desire to cultivate a culture of giving within one's family. In some families, this could include allocating an amount each adult child could give away plus a joint allocation that the children together must decide on. Family milestones such as marriage, birth or becoming empty nesters can inspire philanthropists to impart their values and sense of social responsibility to their loved ones. 

7. Legacy philanthropy making a difference, giving back spanning generations
At the ultimate stage of a philanthropist's journey, individuals and families focus on creating a meaningful, lasting impact. One example is the local business owner who left his entire nine-figure estate to a charitable trust to benefit a rural community, with a committee of local representatives making decisions about which initiatives to support. Retirement, the sale of a significant asset, inheritance or even a personal health scare can tip someone into legacy philanthropy. 

A purpose-driven life
From writing a check to establishing a legacy, each stage of a philanthropist’s life arc represents a vital contribution to making the world a better place. Life events have the power to propel individuals from one stage to the next, ultimately shaping their philanthropic legacy and the positive change they leave behind. 

As a financial advisor, you can deepen your own relationship with a philanthropic client by recognizing where they are in their “life arc” and by helping to guide them in their quest to make a lasting impact on their family and society.