Generational shifts: Fulfilling clients’ charitable wishes
A major transfer of wealth, often referred to as the “Silver Tsunami,” is happening as your Baby Boomer clients establish financial and estate plans to pass their wealth to their Gen X and Millennial children.
The dollars involved are eye-popping. The 2024 Cerulli Associates study estimates that $124 trillion in wealth in the U.S. will transfer through 2048. The research estimates that most of this wealth–$105 trillion–will pass directly to children, grandchildren, and other heirs. And, notably, $18 trillion will flow to philanthropy.
As the transfer of wealth gains momentum, advisors have a major opportunity to position themselves as trusted experts who can help clients not only structure efficient lifetime and estate gifts to heirs but also ensure that charitable wishes are achieved. Greater Cincinnati Foundation (GCF) is here to help incorporate philanthropy into your clients’ financial and estate plans.
There’s a knowledge gap.
Clients may not be aware of the options and benefits of charitable planning. Even many of your affluent clients may still be writing checks to their favorite charities, not realizing that gifts of appreciated stock, for example, can be more tax-efficient, and that tools such as donor advised funds can be incredibly useful.
Next-level strategies are key.
Ultra-high net worth clients will likely need to implement sophisticated strategies for transferring assets smoothly and tax-efficiently. Clients want to maximize the results of their charitable gifts while also protecting their families’ interests. Leaning on partners like GCF to help structure gifts of complex assets, such as closely-held business interests, can make a huge difference in reducing a client’s tax bill and achieving meaningful community impact.
Legacy planning starts now.
Clients may be tempted to put off addressing support for favorite charities in an estate plan. “We’ll look at that in a few years,” is a common but less-than-ideal approach. However, charitable bequests are best addressed as part of a comprehensive estate and financial plan. Naming a fund at GCF as the beneficiary of a client’s IRA, for example, is an extremely tax-efficient way to accomplish charitable wishes.
Our team is here to augment your expertise in charitable giving strategies, which strengthen relationships and improve client retention in your practice.
