March 26, 2025

Developing Effective Family Giving Plans

Your client has a variety of options when it comes to developing a family giving plan.

Family giving plans can be powerful tools to help families give collectively through multiple generations and create lasting charitable legacies. These plans deepen connections among family members, give younger generations a voice, help families realize their charitable giving goals, and support their shared values.

As a trusted advisor, you may have clients ask you for help in creating their family giving plan. Whether a client’s plan uses a donor advised fund, private foundation or other giving strategy, its success hinges on its intentionality and its ability to engage future generations.

When helping your clients develop family giving plans, here are four crucial questions to ask:

1. What values motivate your giving?

The foundation of any successful family giving plan is alignment around the family’s values and vision for the future. Before you begin crafting a giving strategy, have an open conversation with your clients about the values that motivate their giving, and the role those values play in selecting the charitable causes and organizations they currently support.

Be sure to know what your clients hold close at heart early in the conversation.

It is also important to discuss the values your clients want to impart to future generations through their giving. As Mark Weber observed in his book A Spectrum of Legacies: The Gifts You Leave for Your Children and Community, “Surprisingly, or perhaps not, wealthy families tell researchers that money is one of the least important ‘assets’ they plan to leave to their children. Topping the list are values and life lessons.” Giving plans provide unique opportunities to share these values with younger generations in a positive and meaningful way.

While some clients can clearly identify the values that drive their giving and the values they want to impart to future generations, others may find this challenging. When working with these clients, do not hesitate to take advantage of tools like 21/64’s Picture Your Legacy™ deck or Stanford PACS’ Philanthropy Toolkit. If you would like additional assistance in preparing for or facilitating these conversations with your clients, MCF’s Donor Engagement staff would be happy to help!

2. How will you document your values and intentions for the giving plan?

Once a client has identified the values that drive their giving and those they would like to impart to younger family members, it is critical to document them. Doing so will provide future generations with guidance on carrying out the family giving plan when your client is no longer able to do so.

Clients can document their values and intentions in a number of ways, depending on the giving strategy they select. For clients establishing a donor advised fund, this may take the form of a simple letter outlining the fund’s intended purpose. For clients establishing a private foundation, this may take the form of a mission statement or charter.

3. How and when do you want to engage younger generations in the plan?

Family giving plans are great ways for families to involve younger generations in the giving process before they begin making giving decisions. In its study, “Parenting and Philanthropy: Growing the Next Generation of Givers,” Fidelity Charitable found that “sixty-two percent of parents who give also talk to their kids about giving, either through planned or spontaneous conversation – and actively engage them in planning, giving, and volunteering.”

In addition to providing younger family members with the opportunity to observe how older family members give, discussing the family giving plan with them can help convey the general importance of giving from an early age. As Fidelity Charitable’s study noted, “of the parents who give, more than three-quarters (81%) of their children have participated in giving activities within the last year … While almost three-quarters (70%) participated in these activities with other family members, nearly half (48%) did so independently.”

People who want to engage younger generations in their family giving plan can do so in a variety of ways. Some families provide younger members the opportunity to research organizations and provide suggestions on where to direct distributions from the family’s donor advised fund. Others organize giving days where younger family members can attend or volunteer at charitable events held by the organizations they support to better understand the impact those organizations have on their community.

4. Who will carry out the family giving plan when you are unable to do so?

To ensure that your client’s family giving plan remains active and effective, it’s essential to identify and mentor future leaders within the family who will take on the responsibility of guiding the philanthropic efforts as older generations step back.

Identifying who future leaders within the family are early on is crucial.

Succession planning includes both practical and emotional components, such as discussing how leadership roles will be passed on and how new additions to the family can be integrated into the giving process. It also involves clearly defining the expectations and responsibilities of each generation to ensure the plan’s sustainability.

(NOTE: If your client is including a donor advised fund in their family giving plan, they also need to provide the fund sponsor with the name of the person who will be directing distributions when they are unwilling or unable to do so. Not all donor advised fund sponsors allow fundholders to appoint successor advisors so, if this is important to your client, be sure they select a fund sponsor that does.)

Looking for additional resources on family giving plans?

We would be happy to help! Alison Helland, Director of Donor and Advisor Engagement, can assist you or refer you to another member of our Donor Engagement team to serve as a resource for your specific situation. You can reach Alison via email at ahelland@madisongives.org or via phone at 608-446-5937.

You can also join us for our upcoming webinar, “Family Enterprise: Why Every Family Should Think Like a Business,” featuring Gregory Monday, J.D., on April 16, 2025 at 12 pm, to learn more about family giving plans. The program is complimentary, and you can register by clicking here.

Please note that this article has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice.