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November 20, 2012 at 07:00 PM
In this season of giving, there’s no shortage of gifts we can buy to communicate our love for family members. But if we focus on the deeper meaning of the holiday spirit, I think it can lead us to true fulfillment in the form of sharing our values and our legacy with our loved ones.
In 2008, I researched and wrote about an impressive process that teaches generations of wealthy heirs to become good stewards of wealth and to get along well with one another. This process has been refined to meet the needs of individuals and families by Rodney Zeeb, a former estate planner, and Cameron Thornton, a wealth manager. Together, they direct Your Legacy Foundation in Portland. They call their work “transformational philanthropy.”
The foundation provides training and consulting to financial planners and investment advisors, estate planning attorneys and CPAs, as well as nonprofit organizations and professionals who work with donors and families. To learn more about how it could help you assist clients to discover and achieve their vision, I spoke to Cam Thornton.
Olivia Mellan: How did you become interested in helping clients transfer wealth more harmoniously?
Cam Thornton: Sixteen years ago, a client of mine who was a business owner passed away. We established a strategy to protect his principal, but one thing we didn’t do was prepare his heirs for what would occur. After he passed away, all the legal mechanisms of estate planning kicked in, and we had family members fighting each other.
This led me to a lot of soul-searching about what could have been done differently. The result was a system I created called The Family Financial Philosophy, whose purpose is to help families transition wealth from one generation to the next with minimal conflict. It allows people to discover and solidify their deepest values, convictions and objectives related to their wealth.
OM: How did this system evolve into transformational philanthropy?
CT: About seven years ago, Rod Zeeb of the Heritage Institute became aware of my work, and I was invited to take part in their training program. Coming from a financial planning background, I thought money was the most important driver. But the co-founder of the Heritage Institute, Perry Cochell, conducted an interesting exercise where he took money off the table.
It dawned on me that even though money was an important tool, it wasn’t the most important factor in maintaining family unity. What Perry and Rod shared with me was that first you need to establish safety and trust by focusing on communication.
I had more conversations with Rod, and what emerged was a joining of the discoveries we had both made. For the last five years, he and I have directed Your Legacy Foundation, whose primary purpose is to help individual donors understand what’s most important to them in giving.
That’s how we developed transformational philanthropy: the concept that a person giving money or other assets is as profoundly transformed as the organization receiving the gift.
OM: How does introducing transformational philanthropy to clients benefit the advisor?
CT: We see three major benefits. First, it gives you the opportunity to build greater loyalty as you deepen client relationships. Working with families also puts you in a position to be introduced to a new generation of clients. Last, your involvement can lead to referrals and to other new clients with whom you can create strong relationships.
OM: How would an advisor start this process?
CT: One way to get clients on board is to ask them, “Would you be interested in including philanthropy in your planning if you can enhance what your family will receive and minimize what the IRS will receive?”
Then you might ask, “Have you ever been involved in philanthropy, either by volunteering or by giving money?” If the client says yes, I’d find out how they first got involved. That could lead to the question of “What philanthropic activity has meant the most to you? How has it affected your life?”
OM: Should an advisor introduce the subject of philanthropy if the client doesn’t mention it?
CT: Absolutely. Philanthropic planning is an important tool for protecting assets.
Many times, advisors fail to bring it up because they believe they lack skills in this area. In addition, they may not feel comfortable discussing matters of the heart. I find that these advisors often lack a process to discover what is most important to their clients.
