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Getting smart about giving
By HELEN HUNTLEY
© St. Petersburg Times, published July 4, 1999

   Thanks to the stock market and the booming economy, Americans are giving more money than ever to charity. But we could be doing it a lot smarter, says fund-raising consultant and author Tracy Gary. "People get caught up with social and obligatory gifts and don't give as many passionate gifts," she said. "When the majority of giving gets that way, it loses meaning."

   Gary, who was recently in the Tampa Bay area, travels the country trying to "liberate human generosity" by helping people get more out of their giving. She is a consultant to non-profit groups that want to raise money and also to wealthy people who want to give it away.

   Some of Gary's knowledge comes from firsthand experience with money she inherited from her grandfather, a telephone company entrepreneur. "I've given away 95 percent of the $2-million I inherited," she said. "I grew up in a family that had four houses, a plane and a yellow Rolls-Royce. I don't need that kind of life." But she says the principles of smart giving are not just for millionaires. "Somebody giving $1,000 to $2,000 a year can give away $100,000 in a lifetime," she said. "Your money and time can make a huge difference in your community."

   The key, Gary said, is to develop a giving plan that reflects your values and vision instead of reacting to each appeal that lands in your mailbox or comes over the phone. "Look at what you have been giving to," she said. "Think about your values. What is it you want to achieve during your lifetime with your money?"

   For those who want detailed instructions, Gary and Melissa Kohner have written a 105-page workbook, Inspired Philanthropy: Creating a Giving Plan. What core values matter to you, she asks: Courage? Faith? Equality? Justice? Simplicity? What issues spark your interest: AIDS? Animals? Arts? Children? Education? Health? Homelessness? Libraries? She suggests dozens of possibilities and encourages people to narrow their preferences to two or three areas.

   The next step is research and education. "You might need to go to a community forum or to conferences or donor briefings where you can get information on these issues," she said. "Sometimes there are too many people giving in one area, but gaps in other areas."

   Now 48, Gary says that when she was in her 20s and early 30s, she visited 400 California charities to check them out before deciding how to give away her inheritance. "It changed my life forever to see the talent in these groups," she said. Not only did she give away most of her money, she ended up as co-chairwoman of a fund-raising consulting group, Responsible Wealth, in Ross, Calif.

   The kind of strategic giving that Gary advocates is now common for corporations, and is starting to trickle down to individuals, said J. Lloyd Horton, executive vice president of All Children's Hospital Foundation in St. Petersburg. "This is a real trend, particularly with the new (non-inherited) wealth," he said. "These people are more savvy about their giving. They want to see their money used for specific areas, for things and causes they believe in."

   Charitable giving is growing. It rose 10.7 percent in the United States last year, to a total of $174.5-billion, according to the American Association of Fund-Raising Counsel Trust for Philanthropy. Giving grew in every category except the arts, where it declined by just less than 1 percent, and most of the money came from individuals rather than corporations, foundations and estates. But Gary thinks we still are not giving up to our potential. "There are some pretty severe community problems, and a lot of wealthy people are holding onto their money and not reinvesting within their communities," she said.

   One problem, she said, is many people don't realize how wealthy they are. "The top 5 percent of Americans are making $135,000 and up or have assets of $650,000 or more," she said. "There are a lot of people who are in the top 5 percent and don't even know it. They're striving to have more." She suggests developing a formal annual giving plan or budget -- and turning down requests that don't fit.

   American Express Financial Advisors contracted with Gary to share her ideas with the company's financial planners to help them encourage clients to give more. "We believe that this is an important part of a financial plan," said Jan Blakeley Holman, vice president of investment services for the Minneapolis company. And giving does have tax benefits to go along with the emotional rewards.

   In addition to an income tax deduction for their gifts, people who give away appreciated securities or real estate can avoid capital gains taxes that would be incurred if they sold the property. Using charitable trusts as part of an estate plan also can be beneficial to the charity and to family members who otherwise would lose more of their inheritance to estate taxes. "A lot of people apparently have decided that Uncle Sam may be their favorite charity," Gary said. "There is a lot of wasted opportunity."

   She encourages people to give their time as well as their money and to share their values with family and friends. "If kids volunteered with their parents building a house for Habitat for Humanity, it would change who those children are," she said.

    She also likes group giving. People who are interested in a particular area can collaborate and give more than any of them could give alone, she said.

   Gary's workbook is available for $20 plus shipping from Chardon Press at http://www.chardonpress.com on the Internet or (888) 458-8588 by telephone. Traq International Inc. also has a Web site (http://www.benefice.com) to help people design giving plans.