Philanthropy with Philanthropic Desire

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The phrase "Philanthropy with Philanthropic Desire" means using a strategic, impactful approach to giving (Philanthropy) that is driven by a genuine, deep-seated love for humanity and a personal compulsion to help (Philanthropic Desire).

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It is a complete concept that unites the "heart" (desire) with the "head" (strategy).

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Philanthropic Desire: The "Why" (The Motivation)

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• Definition:

  • This is the underlying human impulse—the core value, conviction, or emotional response—that makes a person want to give. It is the "love of humanity" at the root of the word.

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• Advisory Focus:

  • As an advisor, identifying this desire is the first step. It comes from asking your client about their values, their life experiences (e.g., a family member's illness, a childhood struggle), and their legacy goals.

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• The Problem:

  • Desire alone often leads to unplanned, emotional, and potentially inefficient giving (e.g., reactive giving in response to a plea for a quick fix).

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Philanthropy: The "How" (The Strategy)

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• Definition:

  • This is the deliberate, organized action of giving resources with the goal of achieving long-term, systemic change (addressing the root cause of a problem). It moves beyond simply providing immediate relief (charity).

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• Advisory Focus:

  • This involves using technical skills to implement the desire through tax-efficient, high-impact strategies. This includes setting up the right financial vehicles (DAFs, trusts, foundations) and optimizing the assets given (appreciated stock vs. cash).

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• The Problem:

  • Strategy alone, if disconnected from a genuine desire, can feel transactional, mercenary, and focused only on the tax deduction, leaving the client feeling unfulfilled.

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Philanthropy with Philanthropic Desire

 

When the two are combined, you achieve the most powerful form of giving:

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Maximum Donor Satisfaction: The giving is meaningful, not just tactical,

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Maximum Social Return: The gift is structured to maximize its value while providing the best tax outcome for the client's estate.

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Enduring Impact: The client's values are institutionalized and carried on by future generations.

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Integrating Philanthropy Into Your Estate Plan

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Integrating philanthropy into your estate plan is a cornerstone of modern wealth management for high-net-worth clients. It is the most powerful way to align a client's values and legacy wishes with sophisticated tax and wealth transfer strategies.​

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The process has three major benefits: Tax Efficiency, Legacy Building, and Family Engagement.

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Tax Efficiency and Wealth Preservation

 

Charitable gifts are one of the most effective ways to reduce tax liability for an estate, particularly in jurisdictions with high estate or capital gains taxes (like Canada, as an example, where the annual donation limit rises to 100% of net income in the year of death).

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• Taxable Estate Reduction

  • The value of assets bequeathed to a qualified charity is removed from the taxable estate, which can significantly reduce or even eliminate estate taxes.

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• Capital Gains Elimination

  • Donating appreciated assets (publicly traded securities, real estate, mutual funds, or private company shares) in-kind to a charity eliminates the capital gains tax that would otherwise be due upon the sale or deemed disposition at death. The estate receives a tax credit for the full fair market value.

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• Retirement Account Optimization

  • Designating a public charity as the beneficiary of an RRSP/RRIF (or other defined contribution plans) is highly tax-efficient. The plan proceeds are normally fully taxable to the estate, but the corresponding charitable donation credit can fully offset this income, resulting in a tax-neutral transfer to the charity.

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Key Philanthropic Estate Planning Vehicles

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Advisors use several specific structures to achieve a client's giving goals, based on their desire for control, immediate tax savings, and income needs.

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• Charitable Bequest

  • A simple gift of a specific dollar amount, percentage, or residual asset allocated to a charity in the Will or Trust.  Simplicity and Flexibility: The gift is revocable until death and is a straightforward way to create a donation tax credit for the estate.

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• Donor Advised Fund (DAF)

  • The client irrevocably contributes assets to the DAF during their lifetime (getting an immediate tax deduction), but the funds are invested and granted out to charities over time, including after death, via named successor advisors.  Immediate Deduction, Deferred Action: The client gets the tax credit now, and their family can continue the giving legacy for years.

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• Charitable Remainder Trust (CRT)

  • An irrevocable trust is created. Income goes to the donor/family for life or a term of years. The Remainder goes to charity.  Income Stream & Tax Break: Converts appreciated assets into an income stream for the client/heirs while providing an immediate partial tax deduction based on the present value of the remainder interest.

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• Charitable Lead Trust (CLT)

  • The Charity receives an income stream for a term of years. The Remainder goes back to the donor's family (often at a reduced transfer tax cost).  Wealth Transfer: Provides income to charity now, then transfers assets to heirs later with potential estate/gift tax savings.

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• Private Foundation

  • A separate legal entity (trust or corporation) that is fully controlled by the family.  Maximum Control & Legacy: Allows the family to hire staff, manage investments, and involve future generations in active grant-making. (Requires significant administration and cost.)

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• Life Insurance & other Registered Investments

  • The charity is named as the beneficiary of a Registered Investment or a new or existing policy.  Liquidity: Creates a large, tax-free gift for charity at death using relatively small premium payments during life.

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Legacy Building and Family Engagement

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Beyond the financial mechanics, the most significant impact of integrating philanthropy is on the family's legacy.

• Values Alignment:

  • It ensures the client's final transfer of wealth reflects the values and causes they championed during their lifetime.

• Preventing Wealth Erosion:

  • Thoughtful planning can avoid a large portion of the estate being used to pay taxes, instead directing those assets to a meaningful charitable purpose.

• Engaging the Next Generation:

  • Vehicles like the DAF or Private Foundation are excellent tools for bringing children and grandchildren into the decision-making process, teaching them about stewardship, and fostering a shared family value system.

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Philanthropic Desire (The Motivation)

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Philanthropic desire refers to the internal, psychological, and emotional drive that motivates a person to engage in the act of giving. It is the "love of humanity" that compels the action.

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The Critical Connection between philanthropy and philanthropic desire

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As a financial advisor, the key is to understand that philanthropy is the strategy, and philanthropic desire is the fuel.

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A purely financial approach to giving (e.g., only looking at the tax deduction) often results in transactional giving that feels empty or is delayed due to decision paralysis. Conversely, a purely emotional desire without a proper strategy can lead to inefficient or ineffective giving.

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Servicing clients in the areas of wealth, estate, retirement, and tax strategies in the following cities:

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Philanthropy with Philanthropic Desire in Fort Erie, Ontario 

Philanthropy with Philanthropic Desire in Niagara Falls, Ontario 

Philanthropy with Philanthropic Desire in St. Catharines, Ontario 

Philanthropy with Philanthropic Desire in Welland, Ontario 

Philanthropy with Philanthropic Desire in Wainfleet, Ontario

Philanthropy with Philanthropic Desire in Port Colborne, Ontario 

Philanthropy with Philanthropic Desire in Grimsby, Ontario 

Philanthropy with Philanthropic Desire in Niagara-on-the-Lake 

Philanthropy with Philanthropic Desire in West Lincoln, Ontario 

Philanthropy with Philanthropic Desire in Pelham, Ontario 

Philanthropy with Philanthropic Desire in Thorold, Ontario 

Philanthropy with Philanthropic Desire in Hamilton, Ontario 

Philanthropy with Philanthropic Desire in Waterdown, Ontario 

Philanthropy with Philanthropic Desire in Burlington, Ontario 

Philanthropy with Philanthropic Desire in Oakville, Ontario 

Philanthropy with Philanthropic Desire in Brampton, Ontario 

Philanthropy with Philanthropic Desire in Mississauga, Ontario 

Philanthropy with Philanthropic Desire in Toronto, Ontario 

Philanthropy with Philanthropic Desire in Greater Toronto Area 

Philanthropy with Philanthropic Desire in Barrie, Ontario 

Philanthropy with Philanthropic Desire in Alliston, Ontario 

Philanthropy with Philanthropic Desire in Innisfil, Ontario 

Philanthropy with Philanthropic Desire in Niagara Region, Ontario 

Philanthropy with Philanthropic Desire in Halton Region, Ontario 

Philanthropy with Philanthropic Desire in Peel Region, Ontario

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To discuss further or for questions of clarification please contact Mark Albert, CEA, EPC at either:

416-659-6655 or markalbertpfs@gmail.com.

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