The advisor, who had just attended a class to become a Chartered Advisor in Philanthropy (CAP), responds, “I think you should give $1 million to charity.” The clients don’t say a word. The advisor thinks he just lost them and wishes he can take back the words. The wife looks at her husband, then at the advisor. She replies:
“We’ve been talking about that, but we thought our advisors would think it was a dumb idea; no one ever talked to us about it. Where do you think we should give?”
This communication between advisors and clients about charitable giving is the reason Mark Weber, CLU, CAP, a 35-year MDRT member from Omaha, Nebraska, has been leading a study group about advising clients toward charitable giving for the last six years — the very group the aforementioned advisor attended.
The results speak for themselves. A recent survey of financial services professionals who have participated in this group were asked to estimate how much money their clients committed to giving to charity since the advisors started taking the course. The answer: $1.4 billion.
“The number stunned us,” Weber said.
Specializing in succession and estate planning for highly affluent individuals and business owners, Weber had the brochure for CAP — a three-course online program offered by the American College — sitting in his inbox for two years.
Yet when an attorney (with whom Weber had worked to transfer $275 million from a client to their kids) asked, “Are we doing good for society?” Weber considered what more he could do from a moral perspective.
When Warren Buffett spoke at a 2011 United Way fundraiser and encouraged Omaha to go from the fourth-most charitable city per capita in the U.S. to the first, Weber thought about how donors often talk to advisors before making large charitable gifts.
“I thought if I can educate the advisors and get them to be more charitably inclined, they can pass that along to their clients,” he said. “The overall impact would be a more generous community.”
From there, Weber decided to take the CAP program and invited other advisors to take the classes with him. With the support of The American College of Financial Services and the Omaha Community Foundation, Weber gathered three tax attorneys, three tax accountants, three financial services professionals and three nonprofit development directors and met 15 times for two hours each. (Groups like this meet in about 25 cities, Weber said.) The total investment was about 175 hours.
About half a decade later, more than 70 advisors have graduated from the program under Weber’s watch, with a goal of reaching 100. Meeting roughly every other week from May to December, the study group is by invite only, and while Weber initially had to sell participants on the idea, now he has a waiting list.
Some of the strategies to talk about
charity that advisors learn from the group are subtle but significant adjustments. For example, rather
than asking, “Do you want to give money to charity?” during the fact-find (most people haven’t thought
about it, Weber said, so the knee-jerk reaction will be to say no), ask questions about donations they
have put on their tax return, or ask about their experience at the alma mater to which they give.
“If something would happen to you, there’s no doubt the school would miss your gift,” Weber might say. “Would you be interested if I could show you how to continue the gift after you’re gone — and have the government match it?” A very high percentage of people say yes, he added.
In addition to leading discussions about advising clients regarding philanthropic giving, Weber also brings in speakers like CEOs of Fortune 500 companies and Omaha’s leading philanthropist, interviewing them with questions like, “How did you decide how much to leave to your kids?” and “When you decided to give back, what did you do and how did you do it?” Students can then take these stories and share them with clients.
One executive shared how his mother created a board of directors among her grandchildren, with a minimum age of 8 and a maximum age of 20. The board’s role was to give away $15,000 of hers; the kids had to learn how to have a meeting, interact respectfully and determine how much to give to which causes.
An advisor in Weber’s group told a client about this idea, and the client adopted it themselves. “People in the last third of their life want to make a difference; they don’t feel immortal anymore,” said Weber, who wrote a book, “The Legacy Spectrum,” to help affluent individuals learn about passing along their values and money to their children and those less fortunate. “Helping parents teach children how to responsibly handle wealth brings you closer to your client and lets you get to know their children, so when the parents pass away, you may get to work with the kids.”
“It’s very satisfying to give back,” Weber said. “As you get older, you can take this time. I’d rather do that than make another buck.”