Enter the Advisor

Once upon a time, fundraisers asked donors mostly charity-centric questions like, “Why do you give to our organization? What projects or programs are you interested in designating your gifts to?” These questions and the answers they encouraged kept the focus on the charity.

Then came the donor-centric approach where fundraisers asked donors questions like, “How were you able to make this gift? Is there another way you could make your gift?”

By taking the donor-centric approach, fundraisers celebrated the gift event with the donor and then asked the donor to tell the story about what happened in their life to make the gift possible. Did they just get a bonus, sell a business, land a new customer account, sell stock at a profit, etc.? Fundraisers could listen for clues as to whether this gift came from a special one-time financial event, or if there was some kind of ongoing income producing asset the donor owned.

Fundraisers could point out the planned giving opportunities when they discovered the donors owned assets other than cash and the multiple financial and tax-wise benefits of giving assets versus cash.

When donors consider planned gifts, their financial advisor often enters the picture. Remember, these advisors not only serve your donor, but may serve potential prospects for you too. So, an advisor-centric approach makes good sense.

This approach begins with the fundraiser asking the donor who their financial advisor is, and explaining the advisor resources and programs their charity makes available to professionals.

The next step happens in front of the advisor. Your challenge is to make your organization stand out, notwithstanding the fact that many advisors already have in-house planned giving resources, sit on the boards of charities, and may already have been supplied with planned giving resources by other fundraisers.

Solution? Focus on the financial advisor’s most important and unmet business development needs. Explain to the advisor how you can help her retain and grow her assets under management (known as AUM – the most cherished acronym in the financial advisor vocabulary).

Here’s the Deal.

One of the “new normal” ways that a growing number of savvy charitable organizations, including community foundations, are being advisor-centric is by offering advisor-managed donor-advised funds and endowment funds.

These enterprising charities have figured out that it is not their job to invest and manage their financial assets, and that they could greatly accelerate the growth of these funds if they allowed the donor’s qualified financial advisor to continue to manage the assets the donor has given.

That’s how you ensure that the financial advisor doesn’t become your "gift prevention department.” In fact, quite the contrary: involved advisors will want to introduce new clients to advisor-centric nonprofits!

Wait a Minute.

Doesn’t the charity have to open its own account with the financial advisor, so that the donor can transfer their gift from their account to the charity's account? Yes.

So if the charity has 100 donors in 50 states and each donor has their own advisor, the charity would need to consider opening 100 investment accounts in 50 states? Yes.

Do you call that “being savvy”?! Yes!

Let's look at how some advisor-centric charities handle it:

  • One way is to outsource the administration work to a third-party administration company – like the Charitable Trust Administration Company (CTAC) – with the infrastructure and resources to administer the fund program.
  • Another way is to affiliate with a non-competitive charity that operates an advisor-centric program. Having most of the donor’s gift, or a generous percentage of the gift, is better than no gift at all. That’s why some charitable organizations, churches, and even donors who sit on the boards of other charities, have affiliated with Convoy of Hope, for example. 

Keep in mind that the seemingly obvious choices to approach for administration outsourcing, like community foundations, banks and investment companies, are often unable to accept the administration responsibilities without taking on the management of the investment too — which defeats the purpose of being advisor-centric!

How do I Start?

First, consider revising your gift acceptance policies to allow Registered Investment Advisors (RIAs) to manage your donor-advised funds and endowment funds.


  • Design and create the administration infrastructure, or
  • Choose to outsource this administration to a third party, or
  • Affiliate with a charity that already operates such a program.

Once the program is established, investment accounts will be able to be opened with each participating RIA who is managing donor investments.

Any other Tips?

A couple of farsighted charities have developed a Memorandum of Understanding between themselves and the financial advisors. The memorandum includes two provisions to encourage the success and growth of their funds:

  • The Registered Investment Advisor (RIA) has current clients, who together, intend to make a $50,000 irrevocable charitable gift of property, to the ABC Charity Permanent Endowment Fund, which is acceptable under ABC Charity’s current Gift Acceptance Policies.
  • The RIA will endeavor to grow the endowment fund assets, under their management, to $1,000,000 within 3 years from the date of this Memorandum.

As a fundraiser, remember how you keep score: Raising increasingly valuable gifts as quickly as possible. Imagine the incredible value of having an expanding network of financial advisors looking for and bringing to you new donor prospects!

A Challenge.

Isn't it time for you to stretch beyond being donor-centric and become more advisor centric? If so, you will need to get busy offering ways that your donor's advisor can manage your donor advised funds and endowments. 

By: Dan Rice, Co-founder of CTAC and Philanthropy Architect for Convoy of Hope, published previously at Planned Giving Tomorrow.

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