Your good side: Getting in touch with your social impact personality type
Social connections and community impact are two of today’s most important cultural trends. Combined, they add up to a growing commitment to philanthropy.
Not everyone likes to “do good” in exactly the same way, though. Understanding the ideal mix of charitable activities based on your social impact personality type–”investor,” “connector” or “activator”--can be useful.
“Investors” prefer to engage in social impact activities that are independent and do not require scheduling dedicated time or working directly with others in the pursuit of a charitable endeavor. Investors sometimes feel they have more money than time and would prefer to write a check or purchase a product that supports a cause.
“Connectors” prefer to engage in social impact activities that are social in nature, involving the opportunity to get together with other people, although not necessarily always in pursuit of the same specific charitable endeavor. This may include celebrating at community events or marketing a favorite cause on social media.
“Activators” are passionate about participating in one or two causes they care most about, and tend to focus on “changing the world” and impacting a single social issue on a broad scale. Activities generally require focused, scheduled and structured behavior oriented toward a task or community goal. A lot of people who serve on boards of directors are activators.
Whatever your personality type, the community foundation can help. For example, if you are an “investor” type, our team can talk with you about:
–Setting up a donor-advised fund at the community foundation to organize your giving to charities.
–Structuring your estate plan to include a bequest to your donor-advised fund at the community foundation.
–Giving appreciated stock to your donor-advised fund, instead of cash, to minimize capital gains tax exposure.
If you are a “connector,” here are things you might consider:
–Working with the community foundation team to occasionally hand-deliver checks from your donor-advised fund to charities as an opportunity to say thank you to the people working hard to improve the lives of others.
–Giving money from your donor-advised fund to a best friend’s favorite charity.
–Collaborating with siblings, children, and grandchildren during the holidays to make one big gift from your family donor-advised fund to a single charity instead of many small gifts to different charities.
Finally, if you are an “activator,” our team can discuss ideas with you, such as:
–Giving an increasing amount of money each year to a favorite charity based on the organization’s demonstrated results to improve the quality of life for the people its mission serves.
–Giving money to multiple charities that are collaborating to achieve a specific goal, such as increasing the graduation rate within a particular school, discovering new drugs to treat cancer, or rebuilding a community center in a blighted neighborhood.
–Giving to relief efforts after humanitarian tragedies.
Getting in touch with the ways you like to give back means you’ll enjoy your community engagement even more. That’s good for the community--and good for you, too.
Inspiration and reminders: The power of the donor-advised fund
If you’ve not yet considered establishing a donor-advised fund at the community foundation to organize your charitable giving, you may be missing out. And if you’re already using a donor-advised fund at the community foundation to organize your giving, it never hurts to review the benefits you’ve been receiving.
Donor-advised funds are popular because they allow a donor to make a tax-deductible transfer of cash or marketable securities that is immediately eligible for a charitable deduction. The donor can recommend gifts to favorite charities from the fund when the time is right. A donor-advised fund operates a lot like a checking or savings account just for charity, and it’s established according to specific IRS guidelines that create tax advantages and govern administration.
A donor-advised fund can be an effective alternative to a private foundation, thanks to fewer expenses to establish and maintain, maximum tax benefits (higher AGI limitations and fair market valuation for contributing hard-to-value assets), no excise taxes, and confidentiality (including the ability to grant anonymously to charities).
A donor-advised fund at the community foundation is frequently a more effective choice than a donor-advised fund offered through a brokerage firm (such as Fidelity or Schwab). That’s because, at a community foundation, you and your family are part of a community of giving and have opportunities to collaborate with other donors who share similar interests. In addition, you’re supported in strategic grant making, family philanthropy, and opportunities to gain deep knowledge about local issues and nonprofits making a difference.
Thinking differently about scholarships can make all the difference
According to statistics gathered by the National Scholarship Providers Association, approximately $100 million in scholarship money is left sitting on the sidelines each year, unused. Even though the number of scholarships awarded in the United States has increased overall by more than 45% over the last decade, not enough students are applying. These are sobering statistics, considering that the burden of tuition and student loan debt is weighing heavily on America’s young adults.
This presents a challenge for you and other donors who are interested in supporting education as a charitable giving priority. On one hand, you want to help students get the education they need to thrive in their careers. On the other hand, no one wants to fund a scholarship that goes unused.
The community foundation can help. Our team will work with you to establish a tailored charitable giving plan that meets your desire to support education while helping to ensure that the money does not go unused.
First, we’ll help you think broadly about education. Limiting a scholarship fund to four-year institutions could result in a lot of missed opportunities. A college or university is not the only option for post-secondary learning and career readiness. Community colleges, trade schools, vocational programs, and out-of-the-box learning experiences may be a better fit for some students. The community foundation can even help you structure gifts to support teachers, classrooms, and school districts, all of which need resources to deliver the best possible education to students.
Next, our team will help you craft the criteria for the scholarship so that it is not too narrow. In other words, casting a wide net can be important to ensure a strong pool of applicants. Limiting scholarship recipients to a small geographic footprint, area of study, or very specific high school credentials may mean that there simply will not be enough applicants to fully utilize the scholarship dollars.
Finally, the community foundation team is happy to help you with the strategy for getting the word out. Many times, would-be applicants simply are not aware of all the options for scholarships. If scholarship funds don’t adequately promote the opportunities, it may be hard to capture students’ attention as they wade through the vast amount of information available about paying for college.
The team at the community foundation is honored to serve as a resource and sounding board as you build your charitable plans and pursue your philanthropic objectives for making a difference in the community. This newsletter is provided for informational purposes only. It is not intended as legal, accounting, or financial planning advice. Please consult your tax or legal advisor to learn how this information might apply to your own situation.