The adage goes that there is more joy in giving (rather than receiving), and for the high net worth individuals this seems to be true with philanthropy being a much embraced trend – with an estimated 9 out of 10 wealthy individuals involved in some form of giving, whether it be of time, goods or money.
Throughout history wealthy families have supported the indigent, struggling artists, writers and musicians. This doing of good deeds is still a feature of the wealthy today and one only needs to think of the various foundations established by the Bransons, the Gates, the Buffets and even one or two of our successful local businessmen to appreciate the good that can be done.
(Interesting to note is that the bulk of philanthropy in South Africa (27%), is directed towards social and community development, followed by religious institutions or causes (20%), whilst women’s rights and the arts and culture both trail in at 1%.)
Giving back – the savvy way David Knott, a trust and fiduciary expert from Private Client Holdings, says that whilst the easiest way for high net worth individuals to make a difference is to simply write out a cheque for their favourite charity organization, a more meaningful contribution can be made by establishing a trust and then donating funds to the trust.
“A trust formalizes the structure of your good intentions and brings about a disciplined approach. There are income tax and estate duty savings one can take advantage of with a trust and a trust needs to comply with the relevant statutes so as to be registered for public benefit status,” advises Knott.
“It is important that you have the right people assisting you with setting up and managing a trust effectively. Consult with an experienced consultant that has the expertise to offer advice in establishing such a trust and the ongoing management and investment of capital to ensure that your good will endures,” concludes Knott.
For more information on setting up and managing a trust contact Private Client Trust on (021) 426 2111 or visit www.privateclient.co.za.