Giving Season is Here

Published: December 4, 2024

Be Mindful in Your Giving

At Klingenstein Fields Advisors (KF Advisors), we value giving back and supporting meaningful causes. We encourage our clients to approach their charitable efforts thoughtfully and work closely with them to develop strategic philanthropic plans tailored to their goals and values. Areas we typically explore with our clients include:

Aligning giving with your values: Your charitable contributions should reflect your family values and mission. Philanthropy that is meaningful can foster a strong sense of personal fulfillment and can provide a shared sense of purpose for the entire family. For some families, this may be a cultural or social cause, while others may be deeply committed to supporting their alma maters. There is no “right” answer – philanthropy is deeply personal.

Involving your family in giving: For multi-generational families, philanthropy is a powerful way to instill shared values and ensure that the family’s philanthropic goals will continue to be met in the future. Engaging children and grandchildren in identifying causes, deciding how and when to contribute, and exploring giving methods fosters a sense of ownership and strengthens your family’s philanthropic legacy.

Validating the legitimacy of your cause: As we have discussed in previous communications, cybertheft is on the rise and unfortunately criminals often use the cloak of philanthropy to effectuate their crimes. We recommend verifying any cause or organization you wish to support by checking its registration as a tax-exempt entity (typically designated a 501(c)(3)). The IRS database allows you to search by organization name or EIN to obtain useful information and tax return filings, including the organization’s filed Form 990. You can find valuable information regarding an organization’s mission, management compensation, and financial statements. Charity Navigator and GuideStar, are also useful resources which track data on charitable organizations worldwide and provide information on how much of your donation is allocated to its charitable cause versus fundraising, administrative, and other expenses.

Being selective in your giving: The holiday seasons often brings numerous solicitations from worthwhile causes making it difficult to choose. By focusing on a shorter list of important causes to you and your family, you can maximize your impact and make a meaningful difference.

Make the most of your giving: There are many ways to give, ranging from the simple structures to more complex strategies. These include:

  • Direct donations of cash and/or appreciated securities
  • Qualified Charitable Distributions from IRAs
  • Charitable trusts
  • Donor-advised funds (DAFs) and foundations

Each has unique advantages and considerations. Determining the most appropriate strategy for you depends on several factors such as:

  • The size and timing of your gift
  • The duration of your giving
  • The purpose of your gift
  • The accounts in which the assets are held (e.g. retirement vs individual accounts)
  • Your individual tax and legal situation

Giving does not just benefit the causes you support – it can also boost your well-being. An article published in Scientific American discusses research conducted by UC Santa Barbara, which found that giving increases natural “feel-good” chemicals in your brain, primarily oxytocin, and also serotonin and dopamine. Research from the Cleveland Clinic found that giving can enhance your physical and mental well-being.

Important Disclosures

This material is provided for informational or educational purposes only and should not be construed as investment, accounting, tax or legal advice. Always consult a financial, tax and/or legal professional regarding your specific situation. This communication is not intended as a recommendation or as investment advice of any kind. It is not provided in a fiduciary capacity and may not be relied upon for or in connection with the making of investment decisions. Nothing herein constitutes or should be construed as an offering of advisory services or an offer to sell or a solicitation to buy any securities or a recommendation to invest in any specific investment strategy. Investing involves risk, including the possible loss of principal. Past performance is not indicative of future returns. The views expressed herein are as of a particular point in time and are subject to change without notice. The information and opinions presented herein are general in nature and have been obtained from, or are based on, sources believed by Klingenstein Fields Advisors (“KF Advisors’) to be reliable, but KF Advisors makes no representation as to their accuracy or completeness. Although the information provided is carefully reviewed, KF Advisors cannot be held responsible for any direct or incidental loss resulting from applying any of the information provided. KF Advisors represents two investment advisers registered with the Securities and Exchange Commission: Klingenstein, Fields & Co., L.P. ® and KF Group, LP. If you are a KF Advisors client, please remember that it remains your responsibility to advise KF Advisors, in writing, if there are any changes in your personal/financial situation or investment objectives for the purpose of reviewing/evaluating/revising our previous recommendations and/or services, or if you would like to impose, add, or to modify any reasonable restrictions to our investment advisory services.