Shankar Vedantam tells a disturbing story about a dog at sea to raise a serious question about how we humans prioritize our charitable endeavors.

A fire broke out in the engine room of the Insiko 1907, an unregistered tanker, as it passed about 800 miles south of the Hawaiian Islands. The fire swept through the ship so quickly that the crew wasn’t even able to radio for help.

When the fire subsided, 11 men and the captain’s dog found themselves safe, with good supplies of food and water, in the ship’s forward quarters. But they had no engines, no radio, and no means for contacting the outside world.

So the ship drifted aimlessly for days, eventually coming within 220 miles of Hawaii–at which point a cruise ship picked up the crew. Hokget, the dog, however, was left behind.

One of the cruise ship passengers who heard Hokget barking called the Hawaiian Humane Society to see if they would do something to rescue him. The Society alerted fishing boats, but the operation seemed hopeless.

As Vedantam explains,

The problem . . . was that no one knew where the Insiko was. The U.S. Coast Guard estimated it could be anywhere in an area measuring 360,000 square miles.

I don’t need to tell the whole story. A month and a half after the fire broke out, and over $300,000 of private and public taxpayer money later, Hokget was finally rescued.

In the meantime, letters and contributions had poured into the Humane Society from 39 states and four foreign countries. One was a check for $5,000. The notes expressed deep anguish and concern:

“This check is in memory of the little dog lost at sea.”

“Thank you for pulling my heartstrings and for reminding me of all the hope there is left in this world.”

And so forth.

This episode raises a series of disturbing questions, however, writes Vedantam. Read the rest of this entry »

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I’ve posted the story of a major bequest that came to the brink of becoming worthless–or worse than worthless–to the recipients.

I imagine it’s a cautionary tale that many of us should pay attention to.

Check it out on the Strategic Inheritance forums . . . and join the conversation!

I described the technical differences between donor-advised funds (DAFs) and private foundations back in June of 2007. Frankly, at the time, I saw no compelling reason seriously to consider creating a DAF.

Following the FoundationWise^SM conference, however, I’m seeing more reasons than I did back then to consider this alternative. Read the rest of this entry »

I mentioned I was able to participate in a meeting with about a dozen fairly high-end charitable givers. Our host at the meeting told us about a giving strategy that he and his family have begun pursuing in the last few years, a strategy that can “pay back” in tax deductions as much as or even more than whatever you gave.

I thought it was well worth mentioning this strategy just in case you find yourself in a position to make donations of, say, a hundred thousand dollars or more and you’re not yet at the point where you are giving 50% of your AGI (Adjusted Gross Income) to charity.

This strategy could multiply your ability to give. Read the rest of this entry »

I’ve talked about this often enough in the past. (See the “Related posts” list at the end of this one!) But it bears repeating . . . especially if and when it can be said briefly. And I think this is the briefest way I have ever said these things.

What follows is from an interview I did five and a half years ago with the newsletter editor of one of the non-profits we support. I quote his questions and my answers: Read the rest of this entry »

In my last post, I talked about giving your children the vast majority of their inheritance “early”–while they’re still in their 20s and early 30s, say–rather than later.

A few weeks ago, I was talking with a friend who has many years’ experience counseling and coaching wealthy individuals . . . as a wealthy person himself and a friend, not as a professional counselor. He made an interesting observation about a reason why you want to predefine for your heirs–and make sure they know–how much you intend to leave them: You want to remove every potential reason they may have (every potential conflict-of-interest) that may lead them to think that, by reducing cost of the care you receive toward the end of your life, they will benefit.

“I have seen it,” he said, “where the children say, ‘Y’know, if we put Mom in the _____ Village, we will be spending [i.e., they will be digging into Mom's nest-egg!] to the tune of an extra $50,000 a year compared to _____ Nursing Home. Why should we waste our money?’ “

Of course, they are not “wasting” money if the quality of service is significantly different (which it was in this particular case). And they weren’t about to “waste” or “spend” their money. It was Mom’s money they were talking about. But they were already anticipating it as their own. And so they withheld from their mother what should have been rightfully hers . . . if only she and her husband had done advanced planning that predefined for the children exactly what they could expect and demonstrated that there was no reason for the kids to modify their care plans in hopes of gaining advantages for themselves.

I read an article this morning that reminded me: Most estate- and legacy-planning professionals ignore philanthropic considerations in their basic planning strategies.

Alexis Martin Neely, for example, notes, in an article printed in the latest Bottom Line Personal, that single adult parents (widowed or divorced, in particular) need to make allowances in their estate plans not only for their personal health care, but also “for the guardianship of any minor children and transfers [of] assets to heirs of your choice while minimizing taxes.”

It struck me: This is the standard mantra of traditional estate planning professionals. For them, estate planning is all about minimizing taxes and maximizing flow-through to the next generation. And it has absolutely nothing to do with larger life purposes, the legacies–the accomplishments–for which donors might want to be remembered. They don’t ask about favorite causes or charities or philanthropic goals they may have. The question simply never comes up.

And so a person who actually might be inclined to make a significant contribution to some effort in which he or she is truly interested . . . simply won’t make the contribution. S/he will “forget” . . . because s/he was never reminded, never caused, even, to think of it.

And this line of thought reminded me of what I heard two or three years ago from Henry Doorn, executive director of the Barnabas Foundation: “What if you were to add another ‘child’ to your estate plan? What if that ‘child’ were a charity?”

I thought, this morning, “What if we turned that statement on its head? Instead of your favorite charities becoming additional ‘children,’ what if you thought of your children as additional ‘charities’?”

And why would we want to think of our children as “charities” rather than our favorite charities as additional “children”?

Personally: I think it makes sense to think of our children as “charities” because . . . once they are grown, and especially if and as they pass their 20s and become settled adults: what good, really, will our bequests do them . . . or their children?

Yes, for a while, perhaps–while Sarita and I are in our 50s and our children are still establishing themselves in the world and our grandkids are still at home–it might make sense for us to give bequests that could aid them with their lives. But by the time Sarita and I are in our 70s and our own kids are in their 40s and 50s and our grandkids are past college: isn’t it time for our kids to be passing along their resources to their children and grandchildren? . . . So our part becomes more of a charitable contribution to their lives, a “little something extra,” perhaps.

But whatever we give ought not to be some major portion or major addition to their own nest eggs!

Beyond that, shouldn’t we be thinking of the significance of our donations: what our donations will achieve? Will our donations achieve something more important through the lives of our children . . . or through a favorite agency, foundation, or other philanthropic or charitable entity? . . . Especially if and/or as one or more of our children or grandchildren “moves on” to espouse or to pursue causes to which we ourselves are opposed! –Should we donate to them–so they can invest more in their antithetical causes? Or should we donate to the charitable causes that we believe in and let them do whatever they want apart from our support?

[I have one more idea along these lines based on a conversation I had a few weeks ago with a wealthy man I know.]

Is your house big enough? Do you need more room? Will your family be happier in a bigger home?

I think my perspective on this issue was shaped a bit last week by a converation I had with a few members of an American family that has lived and worked most of the time over the last nine years in the foothills of the Himalayas.

*****
As I have intimated in some recent posts in my personal blog, my wife and I spent last week in Thailand with field staff of one of the international charities we help fund.

While there, I volunteered to work on the security detail. As I sat in front of the bookstore they had set up checking people’s ID tags, I stopped a couple of young girls because I couldn’t see their wristbands.

One of them looked at me with a bit more than passing interest: “Are you Mr. Holzmann?”

“Yes.”

She lit up. “We use Sonlight!”

I won’t bore you with the details of that portion of our conversation.

It turns out, they are two children in a family of five kids. They live somewhere in the foothills of the Himalayas and move twice a year to live with a certain nomadic water buffalo-herding tribe that has a summer home and a winter home.

Interesting people!

About 10 or 15 minutes after we began talking, their dad came up. And the subject matter of our discussion broadened a bit. I asked him more about their living circumstances and how one lives with nomads. –I had never met anyone from the West who had adopted and/or adapted to such a lifestyle.

For some reason I can’t remember now, at one point, the dad made a comment that has stuck with me: “When we go back to the States,” he said, “I have found that families with five or more kids always seem to have more room to invite us in than do families with only one or two children. Even families with huge houses and just one child: they never seem to have room to invite us to stay with them. But families with five kids–even though their houses are much smaller: they always have room.

“We may sleep on the floor (which is fine with us). But they always have room. The more kids they have, the more room they seem to have.”

My thought: The physical space is rarely the issue. More often, we are limited by the size of our heart.

Indeed, as I was thinking about what my new friend had to say, I remembered our family’s time in southern California 20 years ago.

We lived in an 800-square-foot hovel. I think that’s the right word. It had holes in the outside walls so big you could see daylight through them when it was light outside and, in the winter, the wind would blow the kitchen cupboards open. For the kids to go to the bathroom, they had to walk through every room in the house–from their room, through Sarita’s and my bedroom, through the living room area, through the kitchen, through the back hallway (where the water heater was) and into the bathroom.

All four children–two girls and two boys–shared a single bedroom

And y’know what? No one complained!

In fact, though we owned four beds (two bunkbeds), until just a few months before we moved (when our eldest daughter was about 11 and a half), all four children preferred to sleep in one bed. We used to talk about how they were like sausages in a container. They preferred to share the bed. There was something reassuring about that closeness, I think.

And our kids got along. They were close. Despite dramatic personality differences. Despite the age range. Despite the fact that they spent most of the time together because we were homeschooling as well.

The physical closeness, I think, actually contributed to our children interacting with each other. It helped enlarge their hearts to make room for others.

FWIW. I thought I’d share my thoughts.

And my prayer: May I have a heart big enough for whatever God calls me to . . . unhindered by my physical surroundings!