How to Talk with Clients about Donor-Advised Funds

NPT UK is proud to introduce a new series for our blog: DAF Perspectives for Advisors. Through the Perspectives series we will deliver useful, timely information to help advisors better manage the philanthropic conversation with their clients and stay ahead of trends and issues in charitable giving.    

Advisors often ask about how best to start a discussion around giving with their clients. Talking about philanthropy offers many benefits—not just for your clients, but for your business, as you deepen your client relationships and learn how to serve them better. Here are five simple ways to engage with your clients on the topic of their philanthropy:

Start early. Many advisors wait to introduce charitable giving vehicles as a solution to a tax or estate planning issue raised by their client. In our experience, however, many private clients are ready to discuss philanthropy early on, even if they are not yet ready to take formal action. By raising the topic during your first few meetings, you can incorporate philanthropy in your clients’ planning from the start—and be ready to act when they are.

Understand your clients’ motivations. Your clients’ primary motivations may include establishing a permanent legacy, uniting their family through shared philanthropic activity, or giving back to their community. Find out what motivates your clients by asking what they’d like to achieve with their philanthropy before moving on to any other aspect of their giving.

Take an interest. Take time to find out more about the charities your clients support. Whether they give to one cause or many, your clients will appreciate sharing what they are passionate about and how their giving is making a difference.

Understand the benefits of different giving vehicles. A donor-advised fund (DAF) is often the simplest and most effective way for clients to manage their philanthropy. Many donors choose to use a DAF as an alternative to setting up their own charitable trust or foundation.

Consider the different types of assets a client has—and what might make the best donation. Contributing cash to a DAF is tax-efficient and simple, but there may be additional benefits to giving appreciated assets, such as publicly traded securities, private equity interests, or even an illiquid gift like art or property.

By having conversations around giving, you can help clients to put their assets to use in ways which are meaningful to them. You have the opportunity to play an important role in this area of your clients’ lives, earning their trust and a greater potential for future business.

For more information about NPT UK donor-advised funds and how we can support your clients’ philanthropy, contact us.

NPT UK does not provide legal or tax advice. This blog post is for informational purposes only and is not intended to be, and shall not be relied upon as, legal or tax advice. The applicability of information contained here may vary depending on individual circumstances.

To download a PDF of this blog post, click below: