What do we look for in technical opportunities? We spend this first issue examining the qualities we look for and aspire to. We value efficiency, of course, but more than that we value plans and investments that honor the mission, values, and identity of the person (and family) being served.

Communication
Clear communication doesn't show up as a feature within a plan, per se. Yet, clear communication is absolutely necessary for a good plan to be put into action and relied upon. First, the mission, values, and identity of the person served and their family needs to be clarified. Next the multitude of players involved in a comprehensive plan must communicate with each other. Communication between family lawyer, accountant, and investment advisor to family wealth counselor and philanthropic advisor makes for an integrated and well implemented plan. How? By setting up a communication strategy between the players and allocating responsibilities to each each team member knows what to do, when to do it, and why it is being done. Clear communication creates accountability for all parties. Yes, this is rarely put onto paper.

Priorities
An understanding of the mission, values, and identity of the individual and family served, creates an intrinsic prioritization of causes. What to give to first, what to avoid. Does avoidance come before giving? Does the client wish to avoid taxes even at the expense of diminishing their income or the size of the inheritance they leave behind? Although it seems backward stated this way, it is often the case that all options for optimiizing wealth are not considered. Charitable giving can increase the inheritance left to children and diminish taxes in some situations. Does a client want to build their own wealth, the wealth of the family, or charitable capital? Mulitgenerational planning offers wonderful opportunities for strategically growing family wealth. Charitable planning abounds with terrific opportunities to enrich living, save money, and endow more giving.

Strategies
The strategy for a plan evolves from the values and priorities. Strategies line up tactics to fulfill values and priorities. So a strategy may involve tactics such as: charitable remainder trusts, donor advised funds, socially responsible investments, long term care insurance, and annual gifts.

Structure
The structure of investments and financial plans can drastically change the gross amount of a person's wealth as well as the accessibility of the wealth. And the structure of an estate plan can have positive or negative ramifications for years to come. Who is better off: A person with a million stashed away in a retirement plan and access to $50,000 in cash OR a person with $50,000 stashed away in retirement plans and a million in stocks? It all depends.

Timing
A person, and their family changes through time. We look for plans that maximize the opportunities through time by taking into consideration risk tolerance, tax strategies, family dynamics. For example, $20,000 at age 25 differs greatly from the same amount at age 50. And that amount of money put into a retirement account at 30 will produce drastically different profits from $20,000 put into retirement at 40. A strong plan considers the stage of life and family plans for all the parties involved. Plans must be updated as one passes through the stages of life in order to adapt to the changing needs of the client.

 

Although our future articles may focus on specific opportunities and what use they can be to our readers, such as whether to start a foundation or use a donor advised fund, all our articles operate with these fundamental qualities being maximized to meet the clients goals.

For excellent examples and explanations, please see our friend, Vaughn Henry's website: http://www.gift-estate.com.