How to teach families to be good financial stewards – press enterprise

Life in 2021 has been full of many changes as we adapt to the environment impacted by COVID-19. Home prices have skyrocketed to historically high values ​​and the stock market has generated strong returns. According to CNBC, an increase in real estate and stock values ​​increased the wealth of the United States by $ 3.5 trillion and $ 1.2 trillion, respectively.

Even though mortgage interest rates are historically low, homeownership is impossible for many. According to IProperty Management, about 36% of American households rent their homes. And Gallup found that just 56% of Americans this year reported owning stocks.

Household debt is also increasing. The New York Federal Reserve Center’s quarterly report on household debt and credit shows total household debt rose $ 286 billion (1.9%) to $ 15.24 trillion in the third quarter 2021. The total debt balance is now $ 890 billion higher than it was. in the third quarter of 2020.

In addition, inflation has affected us all.

Thinking about the holidays and your New Year’s resolutions for 2022, ask yourself ‘what can my family do to help those in need? Have you thought about encouraging your family to support local philanthropic works by donating assets or time to help those less fortunate?

In some families, donation is the subject of daily conversations. Parents involve their children in actions appropriate to their age, such as helping select gifts for children at Christmas or bringing winter coats to a homeless shelter. Teens can be expected to seek out organizations for causes in which they can personally get involved.

As your children grow into young adults, consider hosting family gatherings to discuss philanthropic interests and how to implement good management. Giving together as a family can be both unifying and rewarding.

The first thing to consider when planning a family reunion is to identify what you intend to accomplish by getting together. Are there specific needs within your community that you would like to address? Would you like your family members to identify and research specific charities they would like to support? Or is your meeting just a periodic recording to keep all family members up to date on the status of the organizations you support?

The tips below will help you organize your family reunion, so that your philanthropy discussions are productive:

–Set an agenda for the meeting and stay on topic.

– Determine who will lead the meeting.

–Identify the total amount to be funded prior to the meeting and determine how it will be distributed among charities and family members.

–Establish any guidelines that the charity must follow to be eligible for funding.

–Ask individual family members to advocate for their favorite charity at the meeting. Let your family know that during the meeting they should be prepared to present an idea, provide supporting facts, and accept the group’s feedback. Before the meeting, they may want to review the Charities Tax Form 990 that will be presented at the meeting. Tax forms are available at, giving an overview of nonprofit organizations’ fundraising expenses, agent fees, income, and a long list of other items.

– Emphasize communication and mutual respect. Encourage all family members to speak up and share their reactions. Encourage alignment, compromise, structure and purpose.

-High net worth families can use complex strategies such as charitable trusts, private foundations or family limited partnerships to fund their giving strategies.

Families with moderate means of wealth who have charitable intentions may consider a donor advised fund. A donor advised fund is a charitable savings account that allows you to fund the account and enter the charitable deduction without immediately selecting a particular charity.

Donor-advised funds accept both cash and non-cash assets such as stocks (highly rated is ideal), mutual funds, bonds, and complex assets such as S- and C-Corp private stocks.

Donations to a CFO can be made at any time, but when made, they are irrevocable. The funds grow tax-free for the sole purpose of funding public charities qualified by the Internal Revenue Service. Over time, the donor recommends grants that will be distributed to their favorite charities. In addition, the assets of an ADF are not included in the donor’s estate on death.

This year you can deduct up to 60% of adjusted gross cash income and up to 30% of adjusted gross income (AGI in appreciated assets contributed to a DAF. Donor advised funds can be established with your foundation community or through companies such as Fidelity, Charles Schwab or Vanguard.

If your finances allow you to share your wealth, consider including your family in developing and implementing a giving strategy to support public charities, schools, or churches that match your beliefs. Research has found that spending money on others makes us happier than spending it on ourselves.

Teri Parker is Vice President of CAPTRUST Financial Advisors. She has practiced financial planning and investment management since 2000. Contact her by email at [email protected]

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