What is the portion of your wealth that exceeds your needs? What are you prepared to give away, and on what basis do you determine that?
This post is part of our series the 10W's for Donors: Design Principles for Your Giving.
This series is inspired by the idea that every donor comes to their giving with a unique combination of factors to incorporate and accommodate. Whatever your level of giving, why not become more aware and deliberate about the key considerations shaping the design of your giving? The greater your awareness of what’s driving your design choices , the greater your opportunity to land on giving that truly makes sense for the world and for you.
A great way to start getting insight on your wealth stance is by charting out a lifeline for your net worth and your philanthropic giving.
Begin by drawing out a timeline showing your financial net worth from birth to the present. Then extend this line all the way through to show the net worth you anticipate having at the end of your life. You can show the scale in dollar values if you want, but the real point is the shape of the curve. And yes, this does mean you are also reflecting on your expected span of life. Next chart out your annual philanthropic giving from birth to the present. Then project this line into the future to show the level of annual giving you anticipate through the end of your life. Go ahead and extend beyond your lifetime if you want to establish vehicles for giving that continue on.
When we are doing this exercise with clients at Building Impact, we lay these two charts side by side and consider how well they reconcile. Even if the scales are different, do the shapes of these curves correspond with each other? Are you OK with seeing your net worth diminish as your giving goes up? Do you want to reach the end of your life having maintained a certain level of wealth? Or would you love to “bounce the check to the undertaker,” as Chuck Feeney is on track to do? The founder of Duty Free Shops, Feeney has given away the entirety of his $8 billion dollar fortune during his own lifetime. Now in his 90’s, he has reserved just $2 million to cover the costs of living expenses for himself and his wife.
While it might sound straightforward, this exercise can be surprisingly challenging to complete. Download the worksheet and give it a try!
A second key component of your wealth stance is your “philanthropic posture.” This is about how you identify the resources you intend to give away. As the graphic below illustrates, there are several possibilities.
Download the worksheet and use this as an opportunity to reflect on some key questions: Where would you place yourself currently when it comes to your philanthropic posture? What will it take for you to feel comfortable taking the next step in your giving, wherever you currently fall on this spectrum?
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These are the same materials we use with the social entrepreneurs in our accelerator program and the funders we coach one on one. The world has never been more in need of a new, greatest generation of change agents and that's why we're opening up free access to these materials to anyone who's ready to make use of them!