Are you a long-term or short-term investor? | Nonprofit Spotlight: Community Foundation of Western Nevada
January 23, 2017
When you sit down with your investment advisor, do they ask you whether you'd like to invest long-term or short-term? Probably not. More likely, they ask you what your objectives are for your investments, how long it will be before you need to start receiving income from your investments, and how comfortable you are with risk. When you invest in your community with your charitable giving, the approach should be much the same.
At the Community Foundation of Western Nevada, we characterize short-term gifts as those that will be distributed in one to three years, medium-term as those distributed in a four- to six-year timeframe, and long-term as those distributed over seven years or longer. We use the donor's objectives to help set a timeframe for the use of the gift, to place any restrictions on its use, and for the goals expected to be accomplished as a result of the contribution.
I imagine that you are primarily a long-term investor. Professional advisors tell us that's the only way we'll be able to save enough for retirement. Most people put the bulk of their savings into long-term investments, using tax-advantaged strategies such as an IRA and 401k. This is not dissimilar from using a donor-advised fund at the Community Foundation, which is also a tax-advantaged strategy.
Similarly, many of us have short-term savings for things like an emergency fund, or saving for a car, or vacation. Short-term charitable giving does not accomplish your long-term giving goals, but aids immediately with things like giving a hungry person a meal or buying an impoverished child a gift at Christmas. This type of charitable giving is important, but it does not help permanently solve the persistent root causes and challenges.
A fundamental difference between investment advisors and philanthropy advisors like the Community Foundation of Western Nevada is that when you invest in charity, you can’t get your money back. This makes the decision to give ultimately much more difficult than the decision to save. It is common to struggle with who to trust with your savings. I encourage you to question and research that much or more when it comes to your charitable investments.Chris AskinCEO of the Community Foundation of Western Nevada
Most of the Community Foundation's $90 million of charitable assets are invested for the long-term. Income from those assets is used thoughtfully and strategically. Collaborating with organizations and coalitions in the community using proven programs improves lives and enhances our community. Examples of long-term strategies are helping a homeless person get a job, extending a scholarship to a student for college, aiding addiction recovery, supporting multi-year solutions on housing, helping hundreds of young people find mentors, and preserving significant local open space for future generations. I suggest we give in ways that have an enduring impact on our friends and neighbors.
Why shouldn't our charitable giving reflect our views on life as it relates to planning for tomorrow? Fortunately, many of us don't have to survive living hand to mouth. If you are in a position to make charitable gifts, why shouldn't you have the same expectations from your charitable giving that you have from your retirement savings? If you add up all the charitable donations you have made, deducting those strictly for immediate purposes, you likely have given a sizable amount. You have a right to expect some results from your diligent cumulative charitable giving. Your lifetime of giving can have many lifetimes of impact for people in northern Nevada.
Whether you are a long-term or short-term investor, the Community Foundation of Western Nevada is your trusted advisor in philanthropy. We meet the fiduciary standard of loyalty and care. Your interests are first and foremost in our relationship. We work on your behalf to ensure that your giving is effective and has the desired result. Our philanthropic advisors will help you put together a long-term investment plan in the community causes you care about. Working with the Community Foundation will help you create real benefit, and provide you with tax advantages. Consider your philanthropy a charitable investment.
A fundamental difference between investment advisors and philanthropy advisors like the Community Foundation of Western Nevada is that when you invest in charity, you can't get your money back. This makes the decision to give ultimately much more difficult than the decision to save. It is common to struggle with who to trust with your savings. I encourage you to question and research that much or more when it comes to your charitable investments. An experienced advisor can help, and that is what the Community Foundation does. We've helped fundholders grant more than $80 million over the last 20 years. Even so, we are still a relative secret in the region. If you're serious about your investing and would like to discuss how you can make your giving more powerful over the long-term, please give us a call. No risk involved.
Learn more by contacting me at the Community Foundation. 775-333-5499 or email@example.com.
Chris Askin is the president and CEO of the Community Foundation of Western Nevada.