Philanthropy: 5 key questions to ask your clients

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Australia is in the global top three when it comes to charitable donations, so how can you guide your clients through this growing area of financial advice?

According to Macquarie Adviser Services executive director Peter Shepherd advisers must up skill in the philanthropy process in order to be able to meet the evolving needs of their clients.

“Compared to other markets, like the US for example, the Australian financial advisory market is still in its infancy when it comes to providing philanthropic services to clients,” he said.

“Research suggests that there is a significant knowledge gap. While many advisers acknowledge that philanthropy needs to be part of their overall service, they feel unsure about how best to advise their clients about this topic.

“It is clear however, that discussing philanthropy can actually add great value not only to the client and their chosen charity or organisation, but also to the adviser.”

But what’s in it for you as the adviser? Shepherd believes that discussing philanthropy can help strengthen client relationships and may increase the likelihood of client referrals and client retention by demonstrating your expertise in what is currently a niche area.

It can also engage the next generation of clients and present intergenerational opportunities to engage the children of existing clients.

Here are five questions that you can ask your clients to get the conversation started:

  • Ask clients about their charitable interests and whether they have any charities they are interested in supporting or have supported in the past.
  • Include the question of philanthropy in correspondence with clients before meetings so they know it is part of a list of their broader financial considerations.
  • Find out if philanthropy has played a role in the client’s family finances in the past and if not, whether they would like it to in the future.
  • During retirement discussions, ask about whether they would like to be involved with a charity or whether they envisage philanthropic giving as part of this.
  • During estate planning discussions, ask whether they would like to leave a bequest.

“Starting the conversation with a client can sometimes be the most challenging part of the process,” said Shepherd.

“However, the more knowledge advisers have about this area and how to provide philanthropic advice, the more confidence they will have that they are offering a service that is of real added value to their clients.

“In the same way that insurance and estate planning should be part of a client’s holistic financial plan, philanthropy is an area that clients will increasingly expect their financial advisers to be knowledgeable about so they can incorporate this into their financial plan.”

More stories:

Estate planning and philanthropy: 10 common questions

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