By Ethan Frey, Wealth Advisor, BMO Private Bank

There’s a great deal of truth in the old saying that philanthropy flows from a loving heart and not an overstuffed pocketbook. It doesn’t take huge resources to make a monumental difference. All it takes is a strong social conscience – a sense that there’s an intimate bond among all people, even those unknown to us, that benefits us all collectively – and a commitment to actively work towards making a difference.

Over the past two decades, research has shown that women and men have different motivations for giving and approaches to philanthropy. Of course, as with any generalization based on gender, ethnicity or socioeconomic status, it can be a challenge to separate the facts from mere stereotypes.

One fact, however, is clearly validated by the results of a recent survey conducted by BMO Private Bank. Despite the financial turmoil experienced over the past few years, women are, and remain, inherently philanthropic. An astonishing 96% of high net worth women planned on making charitable contributions in 2013. And 84% of them say that compared to their pre‑financial crisis donations in 2008, they plan to give either more or the same amount.1

What drives the philanthropic behavior of women?

Women tend to have very different priorities, concerns and values than men when it comes to managing wealth. Historically, women have been somewhat more risk averse and cautious in making financial decisions. Even though this is changing as more women take control of financial decision-making both at work and at home, asset protection remains an important concern.

While both men and women are highly motivated to drive social impact through their desires to be true to personal family values and to instill those values in their children, women between the ages of 50 and 59 are more inclined to feel a responsibility to give back to society.2

For many women, wealth management isn’t just about finances, it’s also about family. Regardless of how you define a family – whether children, grandchildren, cousins, or nieces and nephews – women worry about the negative impact wealth will have on the next generation.

The good news is that by successfully channeling the philanthropic impulse so many women possess, they can make a tremendous difference. Philanthropy can provide a great platform not only to teach and empower the next generation about managing their wealth effectively, but also to put them on the path to becoming empathetic, generous and active members of the community. Undertaken as a family, philanthropy can help teach younger children values-based financial independence, and/or bring adult siblings and cousins together to strengthen their relationships.

How women give

For many women, philanthropy is far more personal than simply writing a check – it’s as much about time and community engagement as it is about money. To a considerably greater degree than men, women give where they believe their gift will make a difference (82% vs. 71%), when they know the organization is efficient in its use of donations (81% vs. 69%), and in order to give back to the community (78% vs. 63%). Women also are significantly more likely than men (66% vs. 50%) to give to a charity because they volunteer at the organization, particularly when it’s involved with issues that affect them personally (51% vs. 41%). [1]

Women volunteer to a far greater degree than men, kicking the tires to ensure that the charity is effectively delivering on its stated mission. This type of active engagement helps to model important behaviors both for the family and for the community as a whole. Volunteering together may be one of the greatest gifts women can give to future generations.

Legacies take shape when intent meets action

Giving—whether of time, assets or both—is a vital issue that’s front and center in the minds of many women as they increasingly gain financial might. And women are uniquely positioned to demonstrate and instill what may be the single most important legacy that anyone can impart to the next generation: a selfless desire to support the causes they care deeply about.

Philanthropy doesn’t happen by chance. Charity and compassion are learned behaviors that require role-modeling and active participation to nurture the giving impulse. It requires not only a strong desire, but also an ongoing commitment, a well thought-out strategy and trusted advice.

The role of your advisor

Once you’ve determined where you want to give, the next question is how you want to give.

It is critical to find a trusted advisor who will listen to you, and recommend appropriate solutions to help you put your philanthropic wishes into action. Your advisor should involve your entire family each step along the way, by implementing a simple hands-on approach to giving, by recommending and developing more structured giving vehicles like donor-advised funds, or even by helping you establish a family foundation. Finding the right advisor is the key to successful, generational giving.

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1Source: BMO Private Bank, The Changing Face of Wealth, April 2013.

2Source: Capgemini and RBC Wealth Management 2014 World Wealth Report.

Ethan Frey serves as an advisor to high net worth individuals, families and organizations, including closely-held and family-owned businesses, endowments and foundations, and assembles the appropriate team of professionals to provide a full range of wealth services as part of an overall personal wealth management strategy. He joined the organization in 2011 and has 14 years of experience in financial services.

Ethan attended Georgetown University and Georgetown University Law Center in Washington, D.C. He has earned the Chartered Life Underwriter (CLU) designation and is a member of the State Bar of Arizona. He was named a BMO Private Bank Platinum Award Recipient in 2014.

Ethan serves on the board of directors for UMOM.

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