Soft-sell charity – Holistic strategies

Big private banks aiming to manage the assets of America’s millionaires are talking about family relationships, not tax breaks, the International Herald Tribune reported May 17.

Managing the assets of wealthy Americans is becoming a lucrative and growing business, with the number of households with $5 million or more in net worth growing to 531,000 in 2000, up from 210,000 in 1995, according to Chicago research firm Spectrem Group Inc.

And Baby Boomers are moving away from simply writing checks to charities and getting more involved with their favorite causes, the Herald Tribune said.

“In our experience working with very wealthy donors and corporate donors, generosity is stimulated by compassion and passion about an issue or an idea,” said Stephen Johnson, director of philanthropy promotion at The Philanthropic Initiative, a Boston-based nonprofit whose clients include private banks.

“Those motivators are far stronger than any tax incentives,” he said.

Don Weigandt, a wealth adviser at JP Morgan Private Bank in Los Angeles who mainly advises clients with assets of at least $50 million, agrees.

“You should never make a gift to charity just to get a tax benefit,” he said.

With tax-code changes in the works and more people trying to figure out what to do with their new wealth, private banks and other financial-services groups are recruiting employees from nonprofits and groups experience giving away wealth, the Herald Tribune said.

Philanthropic and estate-planning services also are being used to attract clients outside the U.S., said Tracy Gary of Houston, author of “Inspired Philanthropy: Creating a Giving Plan,” who runs Grantmakers Without Borders, a Web site on giving globally.

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