Identify untapped opportunity with charitable planning

Differentiating your advisory practice is becoming increasingly important; in fact, two thirds of advisors (65%) believe that the need to differentiate their firm from competition will be greater than ever over the next five years, according to the June Independent Advisor Outlook Study from Charles Schwab. Incorporating charitable planning services into your practice is one way to meet this challenge. Many advisors tell Schwab Charitable that they promote philanthropic services and advice as a way to stand out from competitors and broaden relationships with key clients.

Justyn Volesko, AJ Wealth Strategies

"You are adding value in an area where they didn't necessarily know there was value to be added, and it becomes more of a personal discussion with the client."
Justyn Volesko, AJ Wealth Strategies

Hear why charitable planning is such an important part of Justyn's practice.


Seven opportunities

Meaningful wealth management and planning discussions often start with understanding your client's dreams and goals. For many clients this includes philanthropic goals as well. Here are seven common events that give you an opportunity to deepen a client relationship by exploring the client's charitable giving goals and motivations.

  1. The new client meeting
  2. Portfolio review
  3. Tax return review
  4. Planning for a major tax event
  5. Retirement planning
  6. Estate planning
  7. Planning for family giving

Download Schwab Charitable's investment advisor guide on "Initiating Charitable Conversations" to find out questions you can ask your client in each of these situations to understand how they view philanthropy.

Building a referral engine

One of the practices that distinguish top-performing advisory firms is a deep commitment to referral marketing, according to Charles Schwab's analysis of the 2016 RIA Benchmarking Study.1 Charitable planning can help drive referrals in three ways:

  1. Advisors tell us that conversations about charitable planning help build trust and loyalty, which lead to client referrals and longer term relationships.
  2. Sharing your personal philanthropic interests creates an even stronger connection with clients. When you talk about why philanthropy is meaningful to you, it can enhance your credibility and spark more referrals.
  3. Finally, philanthropy can also improve your reputation in your community, which has been identified as a key component of successful referral marketing at top-performing firms.1

Expanding your service offering

Despite the significant benefits of discussing charitable planning and giving with clients, the opportunity remains largely untapped. A 2015 survey by U.S. Trust2 found that only 18% of wealthy investors discuss strategic giving with their advisors. With the help of Schwab Charitable, it is simple to bridge that gap and start building your charitable offering.

If you're not already familiar with donor-advised funds, start by taking the Schwab Charitable tutorial for advisors. Then, dig in deeper to the significant tax benefits by reading our briefs on donating appreciated assets and investments. Your clients will be happy to know that they can often increase the amount they give to charity by as much as 20% if they donate appreciated assets or investments that they have held for more than one year. These can include publicly-traded stock as well as more complex assets such as restricted stock, privately held shares (C-Corp, S-Corp, and limited partnership interests), initial public offerings, real estate, and private equity and hedge fund interests.

Investing a Schwab Charitable account balance for potential growth is another powerful strategy for helping clients maximize the impact of their philanthropic goals. Since Schwab Charitable's inception in 1999, investment growth has made an additional $1 billion available for Schwab Charitable donors to grant to charity.

Staying close to your client's decisions

When your clients have a Schwab Charitable donor-advised fund account, you can remain fully engaged and receive copies of account statements, link your clients' accounts to your Schwab Advisor Services™ master account, and even recommend grants on their behalf.

For Schwab Charitable accounts with balances of more than $250,000, advisors can also actively manage the assets and develop a customized investment portfolio using Schwab's open-architecture platform.

The first year-end deadlines for donating appreciated assets and investments are in early November, so it is a great time to start a conversation with your clients about charitable planning. See the full list of deadlines here.

We are here to help you every step of the way towards a robust philanthropic offering. Contact your Schwab Relationship Manager or Schwab Charitable directly at 800-746-6216 to discuss how charitable planning can help you differentiate your practice and build long-term client relationships.