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 »

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 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.]

I mentioned that profits have to do with increased wealth; and increased wealth is not the same as cash. If we fail to understand those differences, we can run into some serious trouble.

I thought I would illustrate what I am talking about. Read the rest of this entry »

Last August I wrote a brief outline of what one might want to include in a Gifting Criteria Statement.

As I was picking through a pile of papers on my desk on Saturday, I came across the actual document our family has at the moment. I thought you might find it interesting and, possibly, useful–at least as a discussion-starting model for your family’s statement: Read the rest of this entry »

Charitable giving comes in many forms. Cash donations and hands-on volunteerism are only two.

I have mentioned before the Sonlight Rice Bag Project. The repercussions of that project continue to reverberate in my mind and heart.

This morning, I woke up with the idea that I should write to some people with whom our family business competes. Not about our business, per se, but, rather, about opportunities we–both they and we–have to influence our customers for good.

This is a slightly edited version of the letter I sent. Read the rest of this entry »