Pam Velo is  Associate Vice President for Donor Services at CICF. Pam can be reached at pamv@cicf.org.

What is really important to your family? This is one of the questions posed by Charles W. Collier, senior philanthropic advisor at Harvard University and a nationally known expert on planned giving, family philanthropy and wealth psychology. He is the author of the popular book, "Wealth in Families" (2006), about family issues and philanthropic opportunities that concern wealthy people.

In September, as part of its "Inspiring Philanthropy" series, CICF invited Collier to speak to donors about 'Flourishing Families'. The following are some of the thoughts that he shared in his presentation and in his book.

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Collier believes that one of the most important elements of flourishing families is their ability to have meaningful conversations. To let shared core values and principles guide choices about what is important regarding financial wealth and what that wealth means. He states that the meaning you give to your financial wealth is a statement of who you are.

Best Practices
In Collier's opinion, the best practices of successful families include:

• They focus on the human, intellectual and social capital of their family – not the financial wealth.

• They work on enhancing interfamily communication – really getting to know each other.

• They stress the priority of each member’s individual pursuit of happiness.

• They tell and retell the family's most important stories.

• They have collaboratively defined a family vision statement.

• They teach children and grandchildren the competencies and responsibilities that come with financial wealth.

• They give their young members as much responsibility as they can manage as soon as possible.

• The timeframe for determining success is long-term.

Financial Education
Collier talks about the importance of providing financial information to children to help them manage the family's money and possibly an inheritance. Parents should implement a financial education program and tailor it to their children's needs and ages around topics such as saving, spending, philanthropy, budgets, working with investment professionals and understanding trusts. He believes that parents can get started by setting an example, providing consistent guidance, allowing children to make mistakes as well as considering the use of mentors as your child gets older.

To minimize the entitlement syndrome, parents have to set limits and tell children they are not going to get everything they want, even if the family can afford it.

Material and Spiritual Inheritance
In discussing when to leave an inheritance, Collier talks about three basic approaches: First, define the inheritance and give it to them sooner rather than later along with age-appropriate education about wealth management. Second, let them "make it on their own" by first building their careers and their self-esteem, then giving an inheritance after the age of 35 or so. Or, third, phase it in over time – a combination of the other approaches.  He also discusses the tax advantages of leaving the money to your heirs during your lifetime. 

Collier cites the advice of several wealth advisors when discussing how much to give children. Many believe that giving enough money to allow children to pursue whatever career is best for them, without dramatically changing their lifestyle is an appropriate amount. But Collier's book does have some hard numbers that he cites also.

In discussing the question of where philanthropy fits into inheritance plans, Collier believes  that financial wealth can be a tool to achieve greater ends – a way of expressing core values such as care for the environment, meeting the needs of others, education, artistic freedom, etc. He cites an interview with Paul Schervish, author of "The Gospels of Wealth", who says that "philanthropy creates the moral identity of the wealthy." He states that people are going to transfer legacies of meaning as well as financial wealth whether they think about it or not, and so you should consider the importance of passing on a legacy of financial care for others by including charities in your estate plans.

These are just some of the concepts discussed by Collier at the CICF event. If you would like additional information about Charles Collier, or other family philanthropy events,, please contact your CICF staff representative at 317.634.2423.

Each year, CICF brings in speakers who can inform donors about best practices in family philanthropy. Be sure to check future newsletters for upcoming speakers and eventsor visit our website at www.cicf.org. 
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