How to Handle New Philanthropic Requests in the New Year

As philanthropists, we should expect that there will be new requests for donations in the New Year. After all, nonprofit organizations recognize that those of us who give are often more likely to give again than those who have not. There are so many great organizations doing so much to help people learn, grow, and thrive; and they all deserve support to help those in need. The requests likely won’t end (unless you move well out of the area and become somewhat incognito) and this can sometimes leave you torn as to who you should give to and how to allocate donations. You want to do your part, to support worthy organizations, to make your community better; but you can’t help all of them. How does one deal with all these demands without going bankrupt or having to move to Idaho?

To become a happy, fulfilled, and confident philanthropist who remains in control of your life and finances, consider two important steps. One step centers on identifying key causes and the other on personal financial resources.

Identify Key Causes:

It is extremely valuable to be thoughtful about the issues or causes that each of us believes are most important to support. This is not always easy because we want to help so many people with so many differing needs. The answer is not found in wadding through requests or listening to every appeal. Rather, focus on the values that you hold and the problems you consider most important. This often involves the help of a philanthropic consultant or other advisor who can walk you through exercises to determine who you want to help and which problems need to be addressed. But once you’ve determined the key issues that you most care about, you can focus your philanthropy in these areas and politely decline other requests as not aligned with your philanthropic mission.

Plan Financial Resources:

Supporting every request that comes along can quickly overwhelm your resources and jeopardize your family’s financial security. Alternatively, creating a philanthropic budget is a better way to retain control over your family’s finances. Input from your financial, tax, and estate planning advisors can help you determine what level of giving (as well as the best assets to use) is reasonable for you, based on your financial position, requirements, tax liabilities, and desires to support your heirs. If you can determine what amount of support is reasonable for your family, you can create a philanthropic budget that can be devoted to the causes you most want to impact.

Putting it all together:

Once you determine your philanthropic budget, you can determine how to best segregate assets or income for your donations on a monthly or annual basis. Tools (and there are many) such as a Donor Advised Fund (DAF) can help to hold the assets you devote to your giving and then make those gifts. Now that you have a clear picture of what you have to contribute, you can allocate the funds appropriately.

Having determined what issues or causes are most critical, you can focus on finding the organizations that are best addressing the causes you are most passionate about serving. Knowing which organizations you wish to support will help you focus your philanthropic resources to the best ends. The final step is to allocate your philanthropic assets to the causes you are supporting and make donations on a schedule that meets your needs.

With this disciplined approach, you can become a fulfilled and confident philanthropist doing your best to make your community better and stronger and won’t have to find a new identity to handle all the heartfelt requests.

Let me know if I can help you determine the causes most important to you or how to create and fund your philanthropic budget.

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