When my parents passed away a few years ago, my sisters and I decided to honor them by establishing a charitable fund in their names at ACT for Alexandria. The fund has been a powerful expression of our family’s values. When our family gathered last week for Thanksgiving, we discussed the organizations we want to support through the fund.
My parents were artists and social justice activists. They were courageous, choosing to love and marry at a time when their interracial marriage was illegal in most of the country. The Peeler Productions Memorial Fund is a way for our family to remember their lives and put their values into action.
My family’s experience is not unique. Many families tap into the spirit of the season to give back and uplift the community in numerous ways. Some families gather during the holiday season to volunteer to distribute food or donate coats to a local clothing drive. Family philanthropy is a timeless tradition that extends beyond mere financial contributions, encompassing the values, beliefs and principles passed down through generations.
At ACT, this is our busiest time of the year when we work with many families to help them put their philanthropic goals into action through a donor advised fund. A donor advised fund is like a charitable bank account. When you open the account and make deposits into it, you receive an immediate tax benefit.
The assets are invested and have the potential to grow, thereby expanding your giving potential. You have the flexibility to make a donation from the fund to any nonprofit organization of your choice, at any time. It can be a way to streamline and make the most of your giving.
Whether you choose to give with or without a donor advised fund, there are numerous benefits to family philanthropy. Giving as a family instills and perpetuates shared values and beliefs. It provides an opportunity to educate younger generations about social responsibility and the importance of giving back.
In doing so, families can pass on a legacy of compassion and empathy that extends far beyond financial wealth. It can involve more intentionality and strategic decision-making. And it can generate new family connections and traditions with younger and older generations coming together to discuss ideas and learn from each other.
The practice of giving together as a family also lays the groundwork for conversations about longer-term intentions and legacy. A legacy gift – sometimes called a planned gift – is a promise of future funding to a nonprofit organization. When making annual donations, most people look to their disposable income, not wealth.
A legacy gift extends beyond a person’s lifetime and is a gift from someone’s wealth or the totality of their assets. These kinds of donations can be transformational for the designated nonprofit while also being a unique reflection of the donor’s priorities and values.
It all starts with a simple impulse: to make a positive difference in the world. You can cultivate a tradition of family philanthropy this holiday season by having a conversation about the causes and issues that are most important to family members and creating a budget and plan to support those causes. In my family, everyone offers a suggestion for an organization that they think my parents would be excited about. We discuss the organizations and their work. It is a meaningful process of discovery and building consensus.
In my role as CEO at ACT, it is rewarding to be a partner with so many families who like mine tap into the power of philanthropy to bring our family together and contribute to positive change. In a world filled with challenges and uncertainties, the act of giving has the extraordinary ability to transform families and our communities.
If you would like to explore how to deepen your family’s philanthropy, please reach out at firstname.lastname@example.org.
The writer is president and CEO of ACT for Alexandria.