Frequently Asked Questions

For Advisors

Why should I talk to my clients about charitable giving?

Some advisors are reluctant to begin a charitable giving conversation with their client, concerned about making value judgments, especially if the client has not expressed charitable intentions. In reality, identifying your client's philanthropic interests is a wonderful way to deepen the client's trust and strengthen your relationship.

To determine your clients' motivation for and knowledge of philanthropic giving, you might start with these questions:

  • Have you volunteered anywhere? Which volunteer experience has been the most rewarding?
  • What has been the most satisfying charitable gift you have ever made? Why?
  • Thinking about challenges facing your community, what are your greatest concerns and can you help?
  • What would you like to accomplish with your giving?

When does it make sense to suggest a charitable gift?

Philanthropy is a very special decision. As a professional advisor, you can help clients realize their charitable objectives by listening for charitable giving opportunities, explaining options, and suggesting solutions. Significant giving opportunities often arise when clients are making major business, personal, and financial decisions. Our staff can work with you and your client to recommend the best charitable solutions.

I understand that a community foundation focuses on endowment building. What exactly is an "endowment"?

It is a permanent fund set up by an individual or organization through a written agreement between the donor and the Foundation. Gifts to the fund are invested. Investment income is used to make grants and scholarships. The original value of the fund is not spent. All of the Foundation's more than 70 endowment funds are pooled for investment purposes but each individual fund is accounted for separately.

What kinds of grants can be awarded from an endowment?

The Foundation is a very flexible tool for people to use and as long as a project, program, or organization is charitable, anything is possible. Founding donors establish how grants should be distributed from their endowment. Some go directly to the donor's favorite charity or charities, some make grants in certain fields of interest such as the arts, and some are scholarships. A donor-advised fund allows donors to annually suggest where grants should go. The most useful funds to the community, however, are unrestricted endowments. The Foundation uses grants from these funds for its annual grant programs and to make awards that address the community's changing needs.

What is the minimum gift required to start an endowment?

The minimum for establishing an endowment with the Community Foundation is $5,000 ($10,000 for scholarships). However, an Acorn Fund can be established with $500 as long as a donor commits to contributing $500 or more annually until the fund does reach $5,000. The fund will not payout any grants until it reaches $5,000 and that amount has been invested for one full fiscal year.

What types of assets can my client use to start a fund?

The Community Foundation of Switzerland County has the ability to accept a range of assets including:

  • Cash
  • Stocks and bonds
  • Real estate
  • Life insurance properties
  • Retirement plan assets
  • Personal property, such as jewelry and artwork

How are the funds invested and managed?

The Foundation’s Investment Committee, with the assistance of an investment consulting firm, seeks to prudently maximize returns by investing in a balanced portfolio of stocks and bonds and diversifying over a number of asset categories. The Foundation tries to preserve the ‘purchasing power’ of the funds over time by reinvesting a portion of the investment returns back into the fund. That way the endowments keep pace with inflation.

What does it cost for my client to establish an endowment at the Community Foundation?

There are not start-up fees. An annual administration contribution of 1.5% from the fund is used to help with administrative expenses, including reporting annually to founding donors about their funds’ financial activity.

Why establish a fund with the Community Foundation instead of giving directly to a favorite charity?

A gift to the Community Foundation to support a favorite charity or cause is a permanent gift that will produce income forever. A donor who supports a particular charity with an annual gift can continue to support the charity forever by making a permanent gift to the community foundation for that charity during his/her lifetime or in his/her will.