Tyler (00:00):

You know, due diligence does not diminish the generosity. I would say it helps generosity reach its intended destination

Julie (00:15):

All right, well, welcome to The Risk Rundown. Today's episode we are gonna do something that's very holiday-ish. Tyler Banks, welcome to our Risk Rundown episode.

Tyler (00:26):

Happy holidays, Julie.

Julie (00:27):

Happy holidays. 'Tis the season. We are gonna be talking about charitable contributions today, and I wanna put a disclaimer out there that before we get started, it's worth mentioning that this episode is not gonna be about property and casualty insurance per se, but it is something that we collaborate with other trusted advisors to bring everyone to the table to really discuss with our clients about charitable giving, because it does affect us all.

Tyler (00:52):

You know, it's a time of giving, right? And so I think a lot of people's hearts are opening up to different opportunities and find something that's very passion- I do find that most people that, you know, are charitable, it's something that's very close and personal. But you also have to be cautious because every time you got something good, you got a lot of bad actors out there trying to take advantage of the situation.

Julie (01:15):

Yep, we do. And so have you ever seen the TV show What Would You Do? It's with John Quiñones- Absolutely ... and he does, this, you know, puts people in... Yeah, puts people in different scenarios and find out what they would really do. So I'm gonna ask you a question about what you would do. Tyler, I've got a scenario for you, and a friend sends you a link to a fundraiser for a family affected by a natural disaster.

Julie (01:40):

It could've been the wildfires, it could be a hurricane, it could be some of the flooding, whatever it might be, and you trust that person who shared it with you, but you don't know anything about the organization collecting the money. What is your first instinct to do?

Tyler (01:53):

I would say my first instinct would be separate the person from sharing the link from the actual organization receiving the money.

Tyler (02:02):

A trusted, you know, a friend you know, may be doing this with good intentions, but we're gonna wanna verify, verify, verify. Make sure that where they're asking you to send the money is an actual charity that you support and that you wanna give money to. In these situations, obviously they're very passionate.

Tyler (02:23):

There's a lot of immediacy around it, and when there's a lot of immediacy, you just wanna have a little bit of caution. I personally don't think that I would just wanna click on a link that someone sends me, but go directly to the website itself. You know, do some due diligence before you make a donation to make sure that that charity, is something that you support and that has the same values that you have as an individual as well.

Tyler (02:47):

Then also make sure that the money's actually going to the people that are in need.

Julie (02:51):

It's a shame because there's actually, I mean, legitimate organizations out there that are helping, and it's a shame that we have to kind of think that way.

Tyler (02:58):

So, you know, let's take a separate look at it. So, you know, a lot of times when you're doing, you know, something out of a tragedy or a natural disaster, there's obviously immediacy.

Tyler (03:09):

But, you know, Julie, let's take in, something that you make an annual donation to, right? Before making another significant, gift, is there anything that you would want to revisit or verify before you do, an annual gift that you regularly do to the same charity and the same organization?

Julie (03:30):

Actually, you know, my husband and I do this because we do donate on a regular basis to a couple organizations, and the one thing that I always want to try to do is, on an annual basis before I start making  those donations, is to make sure that the mission statement is still aligned with what I was originally thinking that this mission statement was for, right, what that organization was for.

Julie (03:55):

In addition to that, have they changed leadership? Have they changed any governances? Have they had bad press? But for families that are making significant gifts, or building, a long-term giving strategy, there are even additional risks that they need to consider.

Julie (04:15):

And so this is where they really need to get their trusted advisors on board and have those conversations. And it's one of those things that we actually have conversations with our clients about, especially this time of year. With that being said, I do have a quick question for you. During the holiday season, where do most affluent families tend to face the greatest charitable giving risks.

Julie (04:39):

I mean, do you see that they, around the holiday season, do you see that kind of stuff ramp up a bit?

Tyler (04:45):

Absolutely, because that's when people are feeling, feeling the most charitable, right? Is during the holidays. So, I mean, there are organizations, you know, our family supports intentionally, but there's always moments when a story or an immediate need catches your attention, and during the holidays that, that's happened.

Tyler (05:02):

It's okay to give from the heart. And just make sure that the head and the heart are working together, right? So, when the need feels urgent, it's worth taking a few minutes to understand who's collecting the money, where it's going, and whether the organization is legitimate. So I would say during the holidays that, you know, find opportunities to give to things that are important to you.

Tyler (05:27):

But if you feel like there's a sense of urgency behind it, that they're kind of pressuring you to do something, I think that's when you would probably want to have a little bit of caution. I'll ask you a follow-up question, Julie. You know, with giving, a lot of times I think, back in the movies where you come out of a Macy's and you're giving money, to a little Santa Claus that's ringing a bell, what was a very kind of a personal thing.

Tyler (05:53):

But technology has kind of fundamentally changed the giving nature. And so it's made it easier to give. Has it made it harder to know which organization and fundraising efforts are legitimate?

Julie (06:07):

The scams are so sophisticated right now, and especially when it says, there's a little button that says, "Donate now."

Julie (06:13):

To your point, the urgency of it, it just, you kind of have to just pause, right? So GoFundMe is a great, is a great tool, but you just have to make sure that the people that are receiving those funds are legitimate. And the whole lack of transparency, if you email somebody or if you reach out to an organization, and they have kind of like a shield up and they don't really want to give you the full transparency of where the funds are going and how they're being utilized and, how often and that and who's doing the distribution, then that's another red flag.

Julie (06:46):

You have to be, cautious that this technology is great because it gets the funds many times quicker in the, in the organization's hands that really needs to utilize it. But on the flip side of that, it can be a detriment if you do it, if you don't do your due diligence.

Tyler (07:04):

Yeah.

Julie (07:05):

Do you think that like, as charitable giving becomes a little bit more structured with fundraising and family donations and stuff, do you feel that that is a little bit more challenging as they, as these big, huge catastrophic events and these big, huge organizations are structuring their donations?

Tyler (07:24):

When you take a look at these, the type of donations that our clients are making in the millions of dollars or in the hundreds of thousands of dollars, the due diligence should be proportional to the size and complexity of a gift. So a routine donation probably doesn't need the same level of review because you know the organization, you've been involved with it.

Tyler (07:45):

But due diligence does not diminish the generosity. I would say it helps generosity reach its intended destination, which is ultimately the end individual that needs the funds or the resources or the help to improve their lives. So Julie, what are the biggest mistakes you see families making when trying to build a long-term charitable giving strategy?

Julie (08:14):

You know, when we're talking about the mistakes or the challenges, I mean, I think we've kind of touched on it previously because it is about making sure that everything is aligned, with what you're intending, the organization is aligned to what you're intending to, to give for.

Julie (08:31):

I think that it's, it's got to be a long-term play, right? Which then leads us into the multi-generations, the legacy of the next generation- right, doing the same kind of philanthropy, right? I mean, what do you see our families kind of doing when it's bringing in the next generation for these, for these charitable contributions?

Tyler (08:55):

You know, I think it should be about what the family stands for, right? So having a very intimate conversation with everyone involved and saying, "What do we want to stand for as a family?" Then I think the second follow-up conversation needs to be, "Are we doing this private, or are we doing it public?"

Tyler (09:11):

You know, understanding that if we do it public, we're gonna be, the notoriety that comes with, for better or for worse. You know, do we understand the, the repercussions of doing a public donation versus a private donation? And so having that level of conversation. And then also what role the next generation is gonna take in, in these decisions.

Tyler (09:33):

Yeah. So I think the next generation is gonna be more involved if they understand the purpose and have a meaningful voice, and then, also understand how they're going to handle conflicts when they come up, as they inevitably do, even in the situation of giving,  money to these charities.

Julie (09:52):

Well, and you know, it could be like there's charitable of organizations that people have their name on the side of a building, right? And, what does that bring to the notoriety of that family? And one generation might love that, and then the next generation might say, "You know what, we wanna do things privately."

Tyler (10:13):

If there's one thing you would like listeners to kind of understand, that they should do during this donation season of giving, what would it be?

Julie (10:26):

The one thing that I would just say to take away from is just take a minute, pause, make sure that it's, the organization and the passion that you wanna give to and make sure that it's legitimate.

Julie (10:39):

And then, donate away. But I would just say take a minute and just verify before you give.

Tyler (10:46):

You know, Julie, I just wanna make one last point. Generosity and caution should not be in conflict. You know, thoughtful planning, and just make sure it's intentional, because there are so many bad actors.

Tyler (10:57):

We just, you know, charities provide such a needed support network for a lot of families and people in need. I know I've taken advantage of it, you know, when our family was in need, and the resources were tremendous, and we love giving to that charity as a result. That just make sure that it, that where you're putting your money is, is going directly to the individuals that you want to support and you want to help.

Tyler (11:22):

So that'll be my last takeaway, Julie. And obviously, give away, just give intentionally. That, it would be my last, you know, word of caution.

Julie (11:31):
Agreed. Well, thank you so much. Today was a fun topic because it is about giving, and, you know, what better way to start the holiday season with something that's so generous.

Julie (11:44):
So I appreciate that you take your time to do these episodes with me, so that is my thankfulness. But as always, I do wanna make sure that we tell our viewers, please stay safe and stay protected during the holiday season.