Philanthropy Fund Families and Philanthropy An Overview for Donors Goldman Sachs Philanthropy Fund | October 2012 SEPTEMBER 2011 Table of Contents Introduction ............................................................................................................................................ 1 Why should you engage your family in philanthropy? ..................................................................... 2 Who is in your “family?” ....................................................................................................................... 3 What values are core to your family philanthropy? .......................................................................... 4 How do you want to involve your family members in philanthropy? .............................................. 5 Which decision rules should you use in your family philanthropy? ................................................ 6 When should you start talking with your family about philanthropy? ............................................. 7 How can you engage your spouse/life partner in philanthropy?..................................................... 8 How can you engage your preschool- and elementary-age children in philanthropy? ................ 9 How can you engage your middle school- and high school-age children in philanthropy? ...... 10 How can you engage young adults in philanthropy? ..................................................................... 11 Conclusion ........................................................................................................................................... 12 Recommended Resources ................................................................................................................ 13 Circular 230 Disclosure to the Goldman Sachs Philanthropy Fund and invested Goldman Sachs and the Goldman Sachs Philanthropy in the investment options are owned and controlled by Fund do not provide legal, tax or accounting advice. the Goldman Sachs Philanthropy Fund, and are not Any statement contained in this communication part of a client’s portfolio assets held at Goldman, (including any attachments) concerning U.S. tax Sachs & Co. matters was not intended or written to be used, and In addition, subject to applicable law, you (and your cannot be used, for the purpose of avoiding penalties employees, representatives and other agents) may under the Internal Revenue Code, and was written to disclose any and all aspects of any potential support the promotion or marketing of the transaction or structure described herein that are transaction(s) or matter(s) addressed. 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Assets contributed OCTOBER 2012 Families and Philanthropy: An Overview for Donors Introduction 6. When should you start talking with your family “We know that America today – in its most about philanthropy? admirable accomplishments, its most cherished 7. How can you engage your spouse/life partner creative achievements, its most stunning and useful in philanthropy? scientific discoveries, and its most durable civic 8. How can you engage your preschool- and institutions – is unimaginable without the elementary-age children in philanthropy? contributions of its philanthropic families.” 9. How can you engage your middle school- and Virginia M. Esposito high school-age children in philanthropy? National Center for Family Philanthropy 10. How can you engage young adults in philanthropy? Over the past 100 years, families in the United Each family and family dynamic is unique and States have been engaged in philanthropy, making families change over time. How you decide to engage significant contributions to the well-being and your family in philanthropy may also evolve depending improvement of the lives of those in this country and on your circumstances and the abilities and availability around the world. In recent years, the number of donor of your family members. As the authors of an article on families has grown significantly, as evidenced by the family philanthropy from The Bridgespan Group’s proliferation of family foundations and donor advised www.givesmart.org website state, “Because all funds. Many donors have found that engaging their philanthropy is personal, and each family unique, the families in philanthropy can be a powerful experience process is likely to be iterative and complex…the key to and one that brings their family closer together as they achieving results is clarity of thought and disciplined 1 employ their family resources in pursuit of a shared decision-making.” We hope this publication is helpful mission. in clarifying your thought process in engaging your family in philanthropy. For those embarking on the philanthropic journey together as a family, whether engaging the older or next generation in philanthropy, it can be challenging to know where to begin. This publication is designed to help donors think through the key questions related to whether and how to engage your family members in your philanthropy: 1. Why should you engage your family in philanthropy? 2. Who is in your “family”? 3. What values are core to your family philanthropy? 4. How do you want to involve your family members in philanthropy? 5. Which decision rules should you use in your family philanthropy? (continued) 1 The Bridgespan Group. www.givesmart.org Goldman Sachs Philanthropy Fund 1 Why should you engage your family in philanthropy? According to research conducted by the National “The returns on a family investment in philanthropy 3 Center for Family Philanthropy , there are six major are – or can be – extremely high, both internally reasons why families find engaging in philanthropy and externally. When such an investment is well together a valuable experience for family members executed, a family can achieve the cohesion that including: comes with a sense of higher purpose and cooperative effort.” 1. Early experience and discovery: Young Paul Ylvisaker adults can gain specific skills and experiences Conscience and Community such as the demands of governance; and learn more about themselves 2. Lifelong learning: Families can learn about needs and issues from the nonprofits they fund There are many positive reasons to engage your 3. Family discovery: Families have the family members in philanthropy, as well as several less opportunity to experience each other in a than positive reasons. But before you think about the whole new context benefits and potential drawbacks of involving your family 4. Generational ties: Younger family members in your philanthropy, Ginny Esposito, President of the can learn from older generations and vice National Center for Family Philanthropy believes it is versa important to first ask the questions: “Why do you want to 5. A view “outside the airport”: Philanthropy give?” and “How much of why you want to give is can expose family members to social needs connected to your family?” If you are most interested in and solutions and a more balanced view of the continuing to give in the ways and areas you are most world invested in, you may be best off giving on your own. If, 6. Family bonds: Making time for philanthropy however, you have dual goals around giving and the can keep the family connected in a chaotic family, then it is worthwhile considering how best to world engage your family in philanthropy. In the article “How Do I Work with My Family to There are also several reasons why donors should Achieve High-Impact Philanthropy?” advisors at The not involve their family members in their philanthropy. Bridgespan Group observe that the goals people have These include using philanthropy to compensate for for engaging their family members in philanthropy disagreements between family members or mediate generally
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