Five Ways to Overcome Challenges of Individual and Family Giving
At Arabella, we see the great rewards that giving can bring to our individual and family clients, but we also see the challenges they can face in their philanthropic work. While most recognize that grant making is a privilege, there are many times when the role can be awkward, such as when one has to say no to prospective grantees, family, friends, and worthy causes. Additionally, philanthropists who are well known nationally or in their own communities may face public scrutiny of their giving decisions, which can be disheartening and distracting. To avoid these encounters, some donors keep their philanthropy private. However, doing so can sometimes diminish impact and rob a funder of rewarding interactions with grantees, stakeholders, and peer funders. There are ways to overcome these challenges, freeing donors to put their energies into the aspects of philanthropy they find most satisfying while advancing their philanthropic goals:
1. Define a clear philanthropic focus, strategy, and goals. In giving, as in sports, sometimes the best defense is a strong offense. With a well thought out strategy and clearly articulated goals, donors can not only have greater impact on the issues they care deeply about, they can also feel more empowered when declining funding requests. Being able to say, “Sorry, your request does not match our goals and strategies,” helps donors bow out gracefully.
2. Create a buffer by hiring staff, advisors, or outsourced management support. For even the most engaged philanthropists, managing the barrage of requests from friends, family, and prospective grantees can be logistically and emotionally overwhelming. Inserting another layer in the process can allow donors to limit these interactions and free up time and energy to focus on the issues they care most about.
3. Build a network of peers. Knowing you are not alone helps in many contexts, but in philanthropy it can be particularly powerful to connect with peers. Because of wealth, and the notoriety that often comes with it, philanthropists may navigate many unique challenges that may feel isolating. Finding others who share these challenges can build morale, sustain energy, and enhance knowledge and networks.
4. Give with others. While building a network of peers can provide counsel and support, collaborating with family and with peer funders who have similar giving interests can boost impact, knowledge, and enthusiasm. Those with private foundations can even expand their boards to include people they admire, and peers or experts from whom they want to learn.
5. Use various giving vehicles. Many philanthropists have multiple purposes for their giving. With their impact-driven grants, savvy philanthropists often incubate new ideas or initiatives outside their foundations, in donor advised funds for example, so that the projects do not become public in tax filings, prematurely announcing their presence in a new issue or strategy. Similarly, many funders use donor advised funds or personal funds to make grants or donations of a more personal nature that fall outside of their strategic focus.
The longer philanthropists are passionately engaged in their work, the greater impact they can have in both the short and long term. We frequently draw upon the strategies above to help our clients sustain their work and increase their impact.
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Betsy Erickson provides strategic guidance and operational support to Arabella’s family and individual clients. Recently, she has worked with clients to develop strategies around experiential education and conservation.