Now, let’s say that you want to get philanthropically involved in a health-related cause. Where to start? Here are some questions to ask yourself.

1. What is motivating me?

The health sector is rife with problems to solve and opportunities to be seized. Your motivation often may be personal and likely will lead to one of four key areas:

• Your local hospital: When one man’s father died in a makeshift rural medical clinic, he personally raised the funds to build a full service regional hospital with top notch facilities and staff.
• Curing a disease: The examples are many of individuals and families who commit themselves to research and development targeted to a disease afflicting themselves or a loved one.
• Patient care: Unmet social needs – homelessness, for example – directly impact care needs and outcomes. One woman founded an initiative – Health Leads – to provide a solution.
• Systemic reform: Some people take a big picture view, and want to get engaged in public policy research or advocacy.

2. How much am I able and willing to commit, for how long?

This one is about time and talent as well as treasure. You have to be realistic. Maybe you can’t fund a new cancer wing but you can sponsor a garden where patients and families can relax. Maybe you are willing to make a one-time contribution but not a ten-year pledge. Maybe you lack the time (or skills) to serve on a board but can volunteer for a day of service or a specific project.

3. Who can I work with, and should I?

Who else is working on this issue? There may be one or several organizations out there already committed to your cause. You can support one or all of them. You may find like-minded individuals who are interested in pitching their dollars in with yours, too, for greater impact. Due diligence will be required, of course. External rating agencies can provide a starting point. (see our How trustworthy are external ratings blog)

Is this a well-functioning organization? There is a danger of only backing winners. You may have an even greater impact by helping a mediocre organization with a powerful mission to improve, but that may require rolling up your sleeves rather than just going along for the ride.

What if you can’t find anyone? Rare diseases, for example, often attract little or no attention. Some medical philanthropists, often people with business experience, decide to launch a new venture dedicated to their specific cause. (More on that, in another blog.)

4. How do I measure success?

There are two levels to the question. First, there’s the organization that you choose to support. As we’ve discussed before, performance measurement is hard. Accountability and transparency on the part of leadership is as important as the metrics, which will depend on the problem you are trying to solve and organization’s mission.

At a broader level, the question is: How satisfied am I with my philanthropy? Most people support more than one organization or cause, and your philanthropic portfolio probably will change over time.

It comes back to Question 1: What is motivating you to be philanthropic?

Many factors may come into play: family values/legacy, religious faith, gratitude and a desire to give back, public recognition, a sense of duty, tax incentives, wanting to have a significant impact, personal experience with a problem, altruism or simply the good feeling that comes with giving.

Philanthropy, as we’ve said before, is an intensely personal thing. You must develop your own scorecard, and ask yourself from time to time: How satisfied am I with my philanthropic activities and what they are accomplishing? And, is this a personally satisfying experience, to me?

[1] 2015 BNP Paribas Individual Philanthropy Index, Forbes Insights

From an economic perspective, I think of giving as one of the dynamics of wealth. If wealth is the accumulation of a pool of assets (my definition), the flows in and out of that pool matter. There are lots of choices, and tradeoffs are involved because, as a friend put it, “One dollar can’t serve two purposes.”

My wife, Fredi, and I have given to and served on the boards of many charities over the years.  We have similar beliefs about philanthropy, and respect our sometimes different views on which causes to support. Important point: It’s incredibly important to discuss such things with your spouse.

With all that as a backdrop, I’ll take a stab at briefly answering the 6 W’s of Smart Giving.

1. Why do I give?

Giving back is a value that was instilled in me at a young age by my parents and community. Also, I knew I couldn’t change the world but I wanted to serve the needs of society in areas that I found important, and where my contribution could have an impact.

That said, everything doesn’t have to fit neatly into a box. Sometimes I write a check simply because a friend asks me to, or join a board because I know and respect the other people involved. I was a grateful scholarship student at Stanford and HBS, and feel an obligation to pay it forward.

And, finally, there is the sheer joy of it; giving back is one of the most satisfying things I do.

2. What do I give?

Time, talent and treasure all have come into play, though in different measures at different times in my life. When I was starting out, for example, I didn’t have much money but I discovered that my real estate expertise was valued by land conservation groups.

During what I call the “go-go years” of peak family and career responsibilities, my wealth was increasing while my time was at a premium. These days, now that I am retired (or so they tell me), I find a significant portion of my time being spent on my philanthropy or helping others with theirs.

3. Where do I give?

Some people pick one cause and run with it. As with investing, I prefer a diversified portfolio. I write a lot of checks but my giving patterns are in line with the “importance categories” that we described in Getting to Giving. 

A quick analysis of the past several years showed that my top 5 gifts typically represent half of my charitable giving, the next 20 account for 40%, and the last 50 or so add up to only 10%. The causes represented in core and priority categories can change over time, however.

Some of the causes that I care about reflect my heritage, and are quite lasting. My grandfather passed on his passion for land conservation to me, and I am proud that my sons continue the tradition. Others reflect changing circumstances; I didn’t know I cared deeply about cancer until my wife was diagnosed with it.

4. Who do I give to?

The intended beneficiaries of my giving vary depending on the cause. Land conservation tends to involve regional issues and groups. I support organizations that enhance quality of life in my community, such as the Boston Ballet. Others have a broader scope; NPR contributes to a healthy and just nation.

Not surprisingly, I do my due diligence on any organization where I am considering making a significant gift. Yes, once again, the four questions: Is it doing work that is important to me? Is it well managed? Will my gift make a difference (but not make it dependent on me)? Will the experience be satisfying?

5. How do I give?

I have not chosen to set up a permanent family foundation or tried donor-advised funds. My contributions have been to organizations that I believe in. As I’ve said in previous blogs, I believe in providing multi-year support but favor spend-downs over endowments.

In 1993, I set up a charitable trust.  It allows me the luxury of disconnecting giving from tax considerations  It’s a smart move for estate planning, I believe, and has proven a useful vehicle for Fredi’s and my giving.

I hasten to add that, unlike some trusts, we actually give away significant portions of it. We are not intending to build a large corpus.  We hope that our example will encourage our children and grandchildren to be charitable for whatever causes they choose.

6. When do I give?

Some people prefer to wait until they are older (or dead) to make their gifts, figuring that their biggest contribution will be their ability to grow the pot. I was raised to believe that giving is a lifelong responsibility plus I prefer to give now and be personally involved, for impact and fun.

Pension assets are an exception to that philosophy, given our current tax laws. (They would be subject to ordinary income tax and the estate tax, if given to my heirs.)  Several big gifts in my estate plan involve pension assets; the charities will get the same amount, and the impact on my kids’ inheritance will be much less.

Now that you have embarked on your philanthropic journey, you have an opportunity to learn from your experience. I would argue, in fact, that even the most sophisticated philanthropist should do that on a regular basis. 

So, start there: Take a good, hard look at your current giving, and be ambitious but realistic about what you can do in the future.  Try using the 6 W’s – that basic journalistic device – for both reflection and planning.

Each of the W’s involves many choices. There is no “right answer,” of course.  Philanthropy is a personal thing; you must decide what is right for you, and be prepared to reassess as time passes and circumstances change.

Here are some examples of the kinds of questions that you should ask yourself, as you look back and plan forward.

Smart Giving Questions – Some Examples

We will be exploring each of the 6 W’s in more depth in future newsletters, and looking at how they can help you formulate a coherent and – yes – strategic philanthropic plan.