Financial Planning Retirement Planning Tax Planning Insights
Ambassadors Talk Tax Planning at FinServe Summit
Duffy, an associate professor of business planning who also serves as director for the TPCP™ Program, joined FinServe Network ambassadors Terry Parham, Jr., CFP®, ChFC®, CLU®, RICP®, WMCP®, MSFP, Angie Ribuffo, CFP®, RICP®, ChFC®, CDFA®, CLTC®, WMCP® and Drew Gerling, MSFS, CFP®, ChFC®, CLU®, CAP®, FIC, RICP® for the conversation on tax planning. Duffy began by highlighting findings from The College’s 2024 Advisory Services Survey, which stated that out of nearly 400 professionals surveyed, over half used tax planning strategies in their work with clients.
When asked, the ambassadors enthusiastically backed up the results of the survey, testifying they also found themselves using elements of tax planning in their day to day in different capacities.
“Almost any person can benefit from lowering their tax bill, and if you’re not doing tax planning, you’re most likely leaving money on the table,” Parham said. “Clients I talk with every day are usually interested in understanding taxes, but the tax code is so long and complex it’s often daunting for them.”
Gerling agreed with Parham’s assessment. “Tax planning is the one thing all clients seem to share. It’s critical to have that skill set because it’s the foundational element entire plans are built upon,” he said.
Tax Planning Conversations With Clients
Duffy continued by asking the panelists how they bring tax planning into their advisory discussions. The ambassadors agreed that advisors who want to provide tax planning to clients need to look “beyond the hood of the car” and make plans for years down the road, rather than simply addressing the here and now as a CPA or other tax preparer might.
“Clients often feel taxes are an immovable object,” Gerling said. “They’re set in stone and you can’t do anything to change them. This is a misunderstanding we need to break them of by being very direct and modeling the changes that can come with proper tax planning.”
This, as Duffy noted, is what gets many financial professionals hung up: the difference between “tax planning” and “tax advice,” the latter of which is frowned upon by compliance departments and legal regulations. The TPCP™ Program also accents this difference by providing comprehensive, tax-informed planning knowledge to advisors.
“I tell my clients my job is to look into the future; your tax preparer is looking at the now,” Ribuffo said. “Together, we will give you a comprehensive picture, but I’ll be the one looking at year-over-year data and extrapolating information.”
Tax Planning Beyond Individuals
As Duffy and the panel noted, tax planning as part of financial planning goes beyond just individuals and families; it can also play an important role in retirement planning, business planning, and other areas.
“There’s a common misconception you’ll be in a lower tax bracket during retirement because you’re not earning money anymore, but actually the opposite can sometimes be true,” Gerling said. “Clients need to understand the impacts that required minimum distributions (RMDs) and the taxes involved in Social Security, Medicare, and other areas can have on their savings and generational wealth.”
The panel also accented how crucial tax planning is to a sound retirement plan, as well as building or exiting a business through matters such as employment payroll, employee benefits, and business structures.
“There’s a long runway of life after retirement, and we need to help clients land as gently and safely as we can,” Ribuffo said. “You can accumulate as much wealth as you want before you retire, but the one thing that can derail all your hard work if you’re not careful is taxes.”
More From The College
- Meet Our FinServe Network
- Enroll in Our Tax Planning Certified Professional™ (TPCP™) Program
- Learn About Our Retirement Income Certified Professional® (RICP®) Designation
- Watch the Webinar on How to Integrate Tax Planning Into Your Practice
Ethics In Financial Services Retirement Planning Insights
Can You Reduce Systematic Risk in Your Client’s Portfolio?
Index funds have become a dominant feature of investment portfolios. This year, investments in index, or “passive” funds surpassed active investment strategies for the first time in history (Morningstar, 2024). Moreover, individuals in the U.S. are now more invested in the markets than ever before, according to 2023 data from the Federal Reserve. While these investing shifts have brought numerous benefits, there may also be unintended consequences, including vulnerability to the effect of unethical business practices on retirement portfolios. Systems-level asset management is one way to safeguard portfolios against systematic risk.
Index Investing Takes Center Stage
An index fund is one that tracks the performance of a financial index, such as the S&P 500, by investing in all the stocks or bonds of that index. These funds were initially created in the ‘70s to make it easier for investors to diversify their portfolios, thereby reducing their risk exposure. Over half a century later, ease of access has led to a preference for index strategies, surpassing fifty percent of the market share of all funds in 2024. Moreover, the trend is buoyed by widespread retail investing in financial markets, including through indirect investments in 401(k) retirement accounts (WSJ Article, December 2023).
While an active management strategy attempts to beat the total market returns through trading securities to outperform benchmarks, the goal of an index strategy (sometimes called passive investing) is to match the return of “the market,” as defined by the selected index (e.g., FTSE, S&P, Dow, etc.).
The benefits of index funds include expanded access to capital markets for those who may not have the expertise, or time, to manage an actively traded portfolio. Additionally, index investing not only allows ease of access to portfolio diversification, but also appeals to those who believe an investor can’t reliably “beat the market” through single stock ownership. And finally, index funds can be more cost-effective than actively managed funds because managers tend to charge lower fees when tracking an index, thus putting more money back into investors’ pockets.
Systematic Risks Remain, Despite Widespread Diversification
Despite the widespread popularity of diversification through index funds, investors remain vulnerable to systematic risk. When investors diversify through index strategies, they seek protection against volatility in their portfolio because of idiosyncratic risks that arise when putting all your eggs in one basket. For instance, if an investor is overweighted in healthcare stocks, the financial loss resulting from policy change that impacts healthcare would be greater. By diversifying, investors put their eggs in multiple baskets for protection against these specific risks unique to individual sectors or stocks.
Even with diversification, however, portfolios remain vulnerable to systematic risks, such as inflation, war, recessions, and other geopolitical or macroeconomic trends. These are risks that impact the entire market. While diversification protects against idiosyncratic risks, its widespread adoption by investors hasn’t improved exposure to systematic threats. As investors have embraced diversification, what determines their portfolios’ long-term value will be the economy’s intrinsic value, not the relative value of each company in the portfolio. (The Shareholder Commons, 2022). Furthermore, because more individuals are invested in financial markets today than at any time in history, systematic threats could lead to broader financial challenges.
Yet, as Jon Lukomnik and James Hawley argue (2019), the structure of the asset management industry—including the proliferation of undifferentiated products and complex fee structures—combined with the pervasiveness of index investing, has led to portfolios that overlook systematic risks. This makes investors vulnerable to long-term economic threats such as geopolitical issues and climate change (Lukomnik & Hawley, 2019). This threat is particularly pernicious when planning for retirement, which is necessarily long-term.
Glossary of Terms |
|
|---|---|
Idiosyncratic or Specific Risk |
These risks are at the level of a company/enterprise, or an industry. They arise because of management decisions, legal or compliance matters, or technological changes that affect a particular sector of the economy. |
Systematic Risk |
In finance, systematic risk refers to non-diversifiable risks to investments. Such risks are non-diversifiable because they impact the entire market. These risks include pandemics, geopolitical crises, inflation, climate change, and other events that originate from the same source and affect a broad number of securities. Beta, which is a mathematical measure of market volatility, also measures systematic risk. |
Index, or “Passive,” Investing |
An index fund is one that tracks the performance of a financial index, such as the S&P 500, by investing in all the stocks or bonds of that index, or by using other investing techniques to try to replicate the risk and return of the index, or benchmark. This approach to investing, sometimes also called “passive” investing, aims to replicate notable aspects of “the market,” as defined by the selected index (e.g., FTSE, S&P, Dow, etc.). |
Active Investing |
An active investment management strategy attempts to beat the total market returns through trading securities to outperform benchmarks set by financial indices. |
A Systems Lens on Investing Can Address Unethical Business Practices
In recent years, there has been an increasing negative impact of commercial activity on society, also known as externalities. There are numerous statistics to demonstrate this point; one stark example is that by 2050, the continued expansion of global commercial activity is likely to deplete access to critical freshwater resources by one half of the Earth’s total capacity (Albert, et. al., 2021).
Systems investors analyze financial markets by taking into consideration the effect of corporate externalities on the financial, social, and environmental systems on which our capital markets rely. Neglecting externalities can exacerbate risks to these systems. Viewed through a systems lens, this type of market analysis recognizes that the externalities of one business impact the potential success of the entire market through negative feedback loops, thus affecting an entire portfolio. A diversified investor recognizes that externalities produced by one company creates costs borne by other companies in their portfolio. Diversified index investors often own the entire market, and therefore will be financially impacted by these externalities.
We have seen these consequences in the global financial crisis of 2008 to 2009, ultimately resulting in overall financial market instability. As these risks created by companies externalizing costs materialize, asset values may sharply decline, leading to broader market disruptions and increased financial volatility.
This may sound like environmental, social, and governance (ESG) investing or responsible investing, but it’s different. While ESG investors create portfolios that integrate environmental and social considerations with financial returns, systems-level investors seek paradigm shifts on issues that can bring about widespread change to benefit the entire market. (Flamer, 2024). On one hand, a responsible investor might, for instance, exclude companies from a portfolio because of personal values (e.g., gun manufacturers) or select ESG funds that generate social and environmental rewards (e.g., green energy). System-level investing, on the other hand, attempts to affect overall market returns through opportunities to influence enterprise risk and return, with an eye towards the long-term resilience of capital markets (Burckart & Lyndenberg, 2021).
The example above about depleting freshwater resources can demonstrate this distinction. Traditional financial analysis deems environment-related costs like clean-up initiatives as expenses to be minimized. For instance, a shareholder in any one beverage company has an incentive for that company to spend just enough on clean water initiatives to ensure that company’s access to clean water, even if those expenditures create externalities that negatively impact others (e.g., by dumping toxins into a different water basin).
A systems-level approach identifies industries in which water use is most intensive (e.g., chemical manufacturing, agriculture, beverages), conducts a portfolio-level analysis of their water footprint to analyze the relevant feedback loops. Then, the analysis identifies the weakest performers within them for engagement. Because such an investor has portfolio exposure to numerous companies that need fresh water, they will support water management practices that do not deplete access to water for other businesses.
In this way, the feedback loops of the ecological systems are integrated into financial market analysis.
Strategies for Investors
Putting these considerations into practice requires strategic effort by asset managers and owners. The dearth of analysis about systematic phenomena could be a blind spot in long-term investing.
To improve the resiliency of the financial markets, asset managers need skills in both searching for new investment opportunities and stewarding existing assets in index funds, contends economist John Kay (2015). His critique of the industry is that “chasing alpha” through fee-generating buy/sell trades to try to anticipate market expectations is shortsighted because it overlooks opportunities to meaningfully assess drivers of asset value (Kay, 2015). Trading might benefit enterprise-level risk/return, but doesn’t address market-level systematic risks. Investment stewardship activities can be used to shift the perspective of corporate managers toward the portfolio-level interests of diversified shareholders.
One prominent approach is beta stewardship, which is investment stewardship that prioritizes reduction of corporate externalities. While stewardship through ESG integration seeks opportunities for a double bottom line (do well financially by doing good for the planet), beta stewardship recognizes that such an approach is not enough, because systematic risks affect the overall market, not just one company. Thus, even if some companies in a portfolio benefit from issuing green bonds or buying carbon offsets for sustainability projects, discrete efforts will not be enough to solve the impending environmental challenges that all businesses confront.
Beta stewardship involves analysis of the feedback loops in economic systems, and advocates that companies manage business consistent with systems-level effects. A recognized example of beta stewardship is Climate Action 100+, an investor-led initiative targeting the world’s largest corporate greenhouse gas emitters to take steps to avoid externalities that affect economic growth, food production, infrastructure, and water supplies.
Another organization that provides systems-level analysis is The Shareholder Commons. Among their proposed beta stewardship practices is the concept of guardrails, which are measurable and universalizable parameters for corporate activities that cause externalities borne by the overall market. One example of a guardrail is reducing corporate overuse and misuse of antibiotics/antimicrobials in animal agriculture and human health care and hygiene products (The Shareholder Commons, 2022). Antimicrobial resistance is a threat to human health; this occurs when microbes transform over time, no longer responding to disease treatment through antibiotics. Current health care and business practices accelerate this trend. Each single company has an incentive to continue antibiotic and antimicrobial use at current levels because it can enhance production processes, even if they contribute to long-term resistance among the entire population. Developing a standard approach and commitment across companies through guardrails aims to move the needle on an intractable systems-level challenge.
Planning for the Future
Some may think strategic efforts toward systems analysis should be limited to pension funds that manage large, defined benefit programs. But the well-documented shift towards defined contribution plans, such as 401(k) retirement plans, means individual retirees are more invested in the market today than any time in history (Blackrock, 2024). I believe a systems-level lens on managing assets is needed to benefit all investors.
All investors have a role to play in planning for the future:
- Asset managers should prioritize systems-level approaches by examining case studies that describe a business case for systems change and integrating these approaches into their stewardship practices.
- Financial advisors should probe managers on their approach to protecting against systematic risk, and how systems investing factors into their analysis.
- Individual investors should select managers and financial professionals that think critically about long-term performance, and the effects of systematic market risks on retirement plans.
We can achieve these objectives by identifying organizations that have published their stewardship codes and engagement practices, as well as those that promote transparency relating to corporate governance priorities.
Additionally, the financial industry should invest in high-quality research that can further demonstrate how ethical business practices contribute to financial resilience. Now that’s a basket we would all be willing to put our eggs in for the long-term.
Footnotes
Burckhart, W. & Lydenberg, S. (2021), 21st Century Investing: Redirecting financial stragies to drive systems change. Berrett-Koehler Publishers
Lukomnik, J. & Hawley, J. P. (2021), Moving Beyond Modern Portfolio Theory. Routledge.
Lukomnik, J. & Hawley, J.P. (2019), The Purpose of Asset Management, Pension Insurance Corporation.
Kay, J.A. (2015). Other People’s Money: the real business of finance. Profile Books.
Albert et. al. (2021). Scientists' warning to humanity on the freshwater biodiversity crisis. Ambio, a journal of environment and society, 50(1): 85 - 94. https://www.ncbi.nlm.nih.gov/pmc/articles/PMC7708569/
Flamer, C. (March 14, 2024). ESG vs. Systems-Level Investing. The Institute for Corporate Governance, Kelley School of Business. Retrieved October 28, 2024. https://icgblog.kelley.iu.edu/2024/03/14/esg-vs-system-level-investing-featuring-caroline-flammer/
South Pole Carbon Asset Management Ltd.(2020, June 16). An Investor Guide on Basin Water Security Engagement: Aligning with SDG 6. https://assets.ceres.org/sites/default/files/An%20Investor%20Guide%20on%20Basin%20Water%20Security%20Engagement_%20Aligning%20with%20SDG%206.pdf
The Shareholder Commons (2022, September). Antimicrobial resistance and the Engagement Gap: Why investors must do more than move the needle, and how they can. https://theshareholdercommons.com/wp-content/uploads/2022/09/AMR-Case-Study-FINAL.pdf
The Shareholder Commons (2024). Stewardship Practices. Retrieved October 28, 2024. https://theshareholdercommons.com/system-stewardship/#stewardship-practices
Hannah M. (December 18, 2023). More Americans Than Ever Own Stocks. Wall Street Journal. https://www.wsj.com/finance/stocks/stocks-americans-own-most-ever-9f6fd963
Blackrock, Inc. (2024). Larry Fink’s 2024 Annual Letter to Investors: Time to rethink retirement. https://www.blackrock.com/corporate/investor-relations/larry-fink-annual-chairmans-letter
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Financial Planning Retirement Planning Insights
Strategies to Mitigate the 10-Year Rule
Tuesday, October 29, 2024, from 2:00 p.m. - 3:00 p.m. ET
Join Professor of Practice Jeffrey Levine, CFP®, CPA/PFS, ChFC®, RICP®, CWS, AIF, BFA™ to discuss current categories of beneficiaries and the post-death distribution rules that apply to each group, methods beneficiaries can use to minimize taxes on future distributions, how retirement account owners can proactively help reduce the future tax burden on their beneficiaries, and more.
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Knowledge Hub+ is a just-in-time learning and CE platform developed by The American College of Financial Services that curates the wisdom of leading academics, change-makers and innovators, financial planning experts, and practice management leaders into one easy-to-use learning experience for financial professionals.
Knowledge Hub+ delivers the added value of automated reporting of CE credit to the CFP Board and The College’s records, making it easier for financial professionals to fulfill their thirty-hour CE requirements every two years without administrative headaches.
With exclusive live events and new content added quarterly, there’s always something new to learn with Knowledge Hub+.
Diversity, Equity & Inclusion Financial Planning Wealth Management Podcasts
A Deep Dive Into Tax-Informed Planning
In this episode of our Shares podcast, Michael Finke, PhD, CFP® joins one of those thought leaders — Alan Gassman, JD, LLM, AEP® — for an in-depth discussion of tax law and planning, as well as the impacts tax can have on all stages of a client’s life. They examine the connections between taxes and family expenses, small business growth, retirement and legacy planning, and more to show how tax-informed planning can take your practice to the next level.
Alan Gassman, JD, LLM, AEP® is a senior partner at the law firm of Gassman, Crotty, and Denicolo in Clearwater, Florida and an expert in tax law, specializing in the areas of trust and estate planning, taxation, wealth preservation, and the representation of physician and medical practices. Gassman speaks at many tax conferences, national programs, and national and local webinars, and is one of the featured thought leaders in The College’s Tax Planning Certified Professional™ (TPCP™) Program. Gassman is a frequent speaker for continuing education programs and has published well over 200 peer-reviewed articles with publications such as Bloomberg BNA Tax & Accounting, Trusts and Estates Magazine, Estate Planning Magazine, The Florida Bar Journal, Forbes, and Leimberg Information Services Inc. (LISI), as well as many books on tax planning and law. He has also been recognized several times as a top lawyer in the state of Florida and the country by several prestigious industry lists including Who’s Who in American Law and the AV® Preeminent™ Peer Review RatedSM by Martindale-Hubbell®.
Any views or opinions expressed in this podcast are the hosts’ and guests' own and do not necessarily represent those of The American College of Financial Services.
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About The College Financial Planning Tax Planning Press
The College Launches Tax Planning Certification Program
KING OF PRUSSIA, PA – November 4, 2024 – The TPCP™ Program equips financial advisors, tax professionals, and CPAs with the knowledge and tools to develop and implement tax-efficient planning strategies for individuals and business owners. While enrollment is now open, access to the first course (TPCP 101) begins on January 6. The program has already seen nearly 5,000 professionals express interest.
As part of the launch, a live demo with Jeff Levine, CFP®, CPA/PFS, ChFC®, RICP®, CWS, AIF®, BFA™, Professor of Practice in Tax Planning, will be held on Nov. 12, 2024, at 1:30 p.m. ET. Levine, known for distilling complex tax strategies into actionable insights, will guide attendees through the program alongside The College’s academic support team, providing a first look at this new curriculum. You can register here.
“The TPCP™ Program fills a critical gap in financial education by offering advisors practical tools to meet client demands for informed, tax-aware financial strategies,” said George Nichols III, CAP®, president and CEO of The American College of Financial Services. “With the expertise of our faculty, we are thrilled to provide professionals with a credential that brings tax-informed planning to the forefront of comprehensive financial planning.”
The TPCP™ Program focuses on real-world application, covering topics such as tax legislation, retirement tax planning, estate planning, and strategies for individual and business taxation.
“I’m excited to help financial professionals close the knowledge gap in this high-demand area with the launch of The College’s TPCP™ Program,” said Levine. “Tax planning is financial planning, and the TPCP™ provides the first comprehensive, in-depth education on tax strategies that directly align with clients’ goals and needs across their lifetime.”
To enroll in the program, visit TheAmericanCollege.edu/TPCP.
About The American College of Financial Services
Founded in 1927, The American College of Financial Services is the nation’s largest nonprofit educational institution devoted to financial services professionals. Holding the highest level of academic accreditation, The College has educated over 200,000 professionals across the United States through certificate, designation, and graduate degree programs. Its portfolio of applied knowledge also includes just-in-time learning and consumer financial education programs. The College’s faculty represents some of the foremost thought leaders in the financial services profession.
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Contacts
Sarah Tremallo
908-967-0381 / Stremallo@jconnelly.com
Jared Trexler
610-526-1268 / Jared.Trexler@theamericancollege.edu
2024 FinServe Network Class
The six new ambassadors bring the group’s total membership to 22 professionals representing a cross-section of leaders and rising stars in financial services. The FinServe Network includes College alumni and dedicated volunteers who represent the uniqueness and diverse landscape of the profession.
“Through valuable connections and the networks derived from those relationships, we are advancing the conversation around what the financial services profession should truly be,” said George Nichols III, CAP®, president and CEO of The American College of Financial Services. “We couldn't be prouder to collaborate with these leaders and look forward to working together to help shape the future of financial services.”
Introducing Our New Ambassadors
The latest group of FinServe ambassadors bring with them a diversity of both geographical locations — stretching from Alaska to Puerto Rico and many places in between — and expertise in fields from retirement and tax planning to small business planning, wealth management, trust and estate planning, and more.
Mónica Clesse, MBA, FPA is the CEO and founder of Clesse Financial Strategies, LLC (CFS), a financial planning firm that specializes in helping clients develop customized retirement income and tax strategies. With 23 years of experience in the financial services industry, she is committed to guiding individuals and families toward financial security and independence. Her expertise spans across comprehensive financial planning, including tax-efficient strategies, retirement planning, and risk management. Clesse is known for her holistic approach, combining technical financial expertise with a deep understanding of her clients’ personal goals and aspirations.
Terrell Dinkins, ChFC®, RICP® is the president and founder of OBN Wealth Advisors, an independent registered investment advisor (RIA) firm that specializes in wealth-building strategies and comprehensive financial planning for women and small business owners. With over a decade of experience as an investment advisor, Dinkins expertly crafts financial roadmaps that help her clients thrive now and in the future. A true advocate for personal finance education, Dinkins is not only a wealth empowerment speaker, but also a best-selling author. Her books, One Bucket at a Time: A Woman’s Guide to Creating Wealth and Secrets of The 800+ Club: How to Raise Your Credit Score, Maintain Good Credit, and Live the Life of Unicorns have become go-to guides for those seeking financial freedom.
Ande Frazier CFP®, CLU®, ChFC®, RICP®, BFA™, ChSNC®, CDFA®, CEPA, CExP is a partner at Peachtree Planning of North Georgia. She began working in the financial industry over 30 years ago, specializing in personal finance and wealth-building for individuals and business owners. Her skills led her to become a prominent speaker and thought leader in the financial services industry. After serving in various leadership positions, including running a multi-million-dollar fintech company, launching a media company focused on women and money, and serving as a vice president of distribution for a large insurance company, Frazier returned to private practice by rejoining Peachtree Planning Corporation, a premiere financial services firm with offices throughout the Southeast and clientele across the country.
Sahar Pouyanrad, EMBA, CTFA, AEP®, CEP®, ChSNC® is an executive director and the West Regional Trust Team Leader for the trusts and estates team for J.P. Morgan Private Bank. In this capacity, she is responsible for oversight and administration of trust accounts and related services for the firm’s fiduciary clients across the West Region, with a primary focus on ultra-high-net-worth families. Pouyanrad collaborates with colleagues across different business lines to deliver robust banking products for wealthy, complex, and multigenerational families. As the head of new business, she is responsible for partnering with legal, compliance, and risk management to drive new business, manage risk by overseeing review of potential trust and estate opportunities, and work with senior leadership to set new business parameters relating to trusts and estates.
Ryan Swenson, RICP® is the chief growth officer and a financial advisor at Cary Stamp & Co. in Tequesta, Florida. Since joining the firm in 2021, Swenson has brought a deep passion for helping others and a wealth of experience to his role. He cites his small-town upbringing in Minnesota for shaping his strong work ethic, energy, and enthusiasm for connecting with people. Swenson’s professional journey took him through various industries before he found his calling in finance. Swenson continues to grow both professionally and personally. He is a participant in The Ensemble Practice G2 Leadership Institute and a proud graduate of Leadership Palm Beach County in 2022. His dedication to leadership and community service underscores his commitment to making a positive impact in the financial world and beyond.
Dave Valdez, ChFC®, CLU®, AAMS®, CWS®, AIF® is the chief operating officer at Alaska Wealth Advisors, where he manages all aspects of the firm’s operations. This includes financial planning, investments, client service, advisor development and recruitment, compliance, and technology. In addition to this role, Valdez serves as the State Deputy Inspector General at Joint Force Headquarters on Joint Base Elmendorf-Richardson, Alaska. His unique combination of military leadership and financial expertise makes him exceptionally qualified to help investors with their financial wellness.
About the FinServe Network
The FinServe Network is a volunteer group that serves as a valuable resource for The College, advocating on behalf of its vast alumni network, providing unique perspectives and expertise on industry trends, and sharing a collective passion for lifelong learning. FinServe ambassadors often help provide a behind-the-scenes preview into the innovative ways The College is growing with the intent of sparking ideas to put forward in their own careers.
Issues such as training, retention, career development, access to financial services, practice management, and more were all discussed during The College’s inaugural FinServe Summit in 2023, and elaborated upon at the 2024 Summit in talks from College staff and special guests. FinServe ambassadors also have unique opportunities to play an active role in promoting College initiatives and receive exclusive opportunities to help them create content that builds their standing as leaders in the profession.
We congratulate the 2024 class of our FinServe Network, and look forward to working with them as we continue our mission to uplift the profession and benefit society.
More From The College
- Meet the Members of Our FinServe Network
- Read our 2024 FinServe Summit Recap
- Browse Our Programs
Philanthropic Planning Insights
Discovering the Realities of Planned Giving
Steven L. Meyer, PhD, author of Personalized Philanthropy: Crash the Fundraising Matrix, recently sat down with Chartered Advisor in Philanthropy® (CAP®) Program Director and Assistant Professor of Philanthropy Jennifer Lehman PhD, JD, CFP®, CAP® to discuss his thoughts on charitable giving and how advisors can deviate from standard ways of thinking to achieve better outcomes.
Escaping the Matrix
Lehman begins her conversation with Meyers by asking him about his inspiration for writing Personalized Philanthropy: Crash the Fundraising Matrix. Meyers responds by saying, “I wanted to share these incredible stories that I had picked up…and the experiences, and along the way I felt that I had kind of redefined the way that I was thinking about philanthropy and fundraising.”
Meyers then goes on to explain his process for writing the book, stating that one of his first challenges was what he would name it. Meyers cites inspiration from the movie The Matrix, stating, “The book and the movie are both about this process…of waking up and…gaining your superpowers as you find your voice, and you find these strategies that will work for you and allow you to thrive in an environment where a lot of people have very difficult times.”
Killer Apps
As their conversation continues, Lehman asks Meyers about his “killer apps.” These personalized plans, according to Meyers, empower all donors to qualify as “major donors,” with far greater impact than they may initially envision.
In reference to the “killer apps,” Meyers states, “Instead of…viewing donors as having just a transactional capacity, you think about them in terms of their total lifetime value.”
Meyers offers his idea of the “philanthropic mortgage” as the best means of visualizing this concept. As he explains, “When you buy a house, you don't have to wait till it's completely fully paid for. You start living there and enjoying the benefit of your house right away. So why can't we think about a gift in that same way, or an endowment in particular?”
When discussing step-up gifts, another of Meyers’ “killer apps,” Lehman points out this option may be favorable to younger donors, stating, “That could work really well for a young professional: somebody early in their career, and it gets that philanthropic mindset going where they are giving a little each year – and then, whether it's every year or every few years, they step it up a little bit.”
Meyers supports this point, sharing a personal anecdote of a young donor being able to see the fruits of his gift realized by giving through a step-up gift plan. Meyers touts this as one of the top benefits of step-up gifts.
Thinking Creatively
After discussing several of these unconventional ideas with Meyers, Lehman points out the importance of thinking creatively in philanthropic giving. She asserts that by approaching donors and expecting them to have cash assets at the point in time the gift is planned, many potential donors can be eliminated from the pool as compared to the amount of donors that may be able to provide gifts through alternative methods, such as virtual endowments and non-cash assets.
Lehman goes on to discuss more creative methods of planning charitable gifts and the concepts behind them. To learn more about these methods of planned giving, the full discussion can be viewed in Knowledge Hub.
More From The College
- Gain philanthropic and legacy planning knowledge with our CAP® Program
- Learn about the American College Center for Philanthropy and Social Impact
Diversity, Equity & Inclusion Financial Planning Wealth Management Podcasts
The Power of Coordinated Planning
In this episode of our Shares podcast, Lindsey Lewis, MBA, CFP®, ChFC® speaks with Padric H.B. Scott, AEP®, CFP®, ChFC®, CLU®, WMCP®, CCFC, CAP®, MSFP, founder and CEO of Crossroads Capital Partners and a member of The College’s FinServe Network and NextGen Advisory Task Force, about his philosophy of coordinated planning. They discuss Scott’s background in the NFL and transition to financial services, as well how he has adapted the strategies of a winning football team to a new approach toward managing client relationships.
Padric H.B. Scott, AEP®, CFP®, ChFC®, CLU®, WMCP®, CCFC, CAP®, MSFP is the president and CEO of Crossroad Capital Partners, where he oversees a team of 10 lady boss associates in the firm and has five advisors in his brokerage unit. In seven years of private wealth practice, he has been named to prestigious lists such as Advisor Today’s Top 4 Under 40 Nationally 2024, The American College of Financial Services’ NextGen Financial Services Professional Award recipient 2023, NAIFA Florida Top 4 Under 40 2023, Northwestern Mutual's Forum, and Forbes Best-In-State Financial Security Professional. He graduated from The College with his Master of Science in Financial Planning (MSFP) degree in December 2023, receiving along the way the CFP® certification as well as the Accredited Estate Planner® (AEP®), and Chartered Advisor in Philanthropy® (CAP®) designations among other planning designation specialties. As a result, he is listed as an estate and business planning specialist in the Northwestern Mutual framework of wealth advisors. He loves his God, family, church, and believes strongly in the motto "Achievement in Every Field of Human Endeavor!"
Any views or opinions expressed in this podcast are the hosts’ and guests' own and do not necessarily represent those of The American College of Financial Services.
More From The College
- Learn About Our CFP® Certification Education Program
- Learn About Our Chartered Advisor in Philanthropy® (CAP®) Program
- Learn About the Accredited Estate Planner® (AEP®) Program
- Learn About Our Master of Science in Financial Planning (MSFP) Degree Program