You may be surprised to know that many financial advisors discourage their clients from making large charitable gifts. Why? Because advisors fear they’ll have fewer of the client’s assets to manage and they’ll lose out on advisory fees. This mindset is completely wrong, since doing what’s in your client’s best interest is the right thing to do ethically, and usually results in more business for advisors in the long run. I’ve devoted much of my career to changing the way financial advisors think about charitable giving. Still, some habits are hard to break.
As part of my series about “individuals and organizations making an important social impact”, I had the pleasure of interviewing Randy A. Fox.
Randy A. Fox, CFP, AEP the founder of Two Hawks Consulting, LLC. He is a nationally known wealth strategist, philanthropic estate planner, educator and speaker who recently founded the 10 Billion for Charity initiative. Fox is currently the editor in chief of Planned Giving Design Center, a national newsletter and website for philanthropic advisors. He is a past winner of the Fithian Leadership Award by the International Association of Advisors in Philanthropy.
Thank you so much for doing this with us! Can you tell us a story about what brought you to this specific career path? Randy, tell us about your journey and how it relates to social impact.
I studied Chinese and political science in college. Like many young people who came of age in the 1960s, I was very passionate about making things better in our country. I was also taught at a young age the importance of helping people and always going the extra mile. As a third-generation entrepreneur, I worked in several different family businesses for my father and grandfather. I learned valuable life lessons about business operations, the value of hard work and pursuing one’s dreams no matter how many roadblocks life throws at you. It’s also where I saw first-hand how family dynamics can complicate matters in closely-held businesses and ultimately erode their success. I knew there had to be a better way to build and protect family wealth while preserving family harmony. I entered the world of financial planning in the mid-1980s. The notion of being a comprehensive planner rather than a financial product salesperson was in its infancy. But even in those early years, I knew this would be the right path for me.
Can you share the most interesting story that happened to you since you began leading your company or organization?
It was a convergence of three things:
1. As mentioned earlier, I’m a child of 1960s. I grew up during the Vietnam War protests and civil rights movement. It was all about changing the world. Growing up in Chicago, I have to admit the new movie The Chicago 7 was pretty accurate.
2. Shortly after I started my career in the financial services world, the 1986 Tax Act eliminated many of the tax shelters that were available to wealthy people at the time. That really shook up the financial planning profession.
3. Also in the mid-1980s, I started taking courses on charitable planning, which was fairly new at the time. As I learned more and more about charitable planning, I realized I didn’t know anything about estate planning. So, I had to learn more about estate planning to tie it all together. Otherwise I would have remained a “one trick” pony when it came to financial planning.
Can you share a life lesson gained early in your career?
Early in my career, I took my first training program in charitable planning and learned about Charitable Remainder Trusts (CRTs). I was fascinated that you could give money away, get an income tax deduction for doing so, avoid the taxes, and still have an income stream for life. Amazing! Despite all the wealth in this country, I was equally amazed that so few highly affluent people (and their advisors) new about techniques like CRTs.
To drum up business, I went to law firms door to door. I tried to educate them about how CRTs could help their clients. I felt like the Fuller Brush salesman of the estate planning world. For some reason, they let me into their offices more often than not and started to listen. I actually built some wonderful long-term relationships with my door-to-door approach. Turns out most of the firms didn’t know anything about CRTs. I guess they trusted me.
Some of your readers may not know that a CRT is an irrevocable trust that generates a potential income stream for you, the donor to the CRT, or other beneficiaries, with the remainder of the donated assets going to your favorite charity or charities. “Irrevocable” means the terms of the trust can’t be changed without permission of the named beneficiaries.
Can you describe how you or your organization is making a significant social impact?
As 2020 drew to a close — good riddance — I started thinking about ways to make a bigger impact on the philanthropic world. I can’t recall a time when so many people and organizations have been in need since the Great Depression. One day, I was listening to a Dan Sullivan/Joe Polish podcast about creating exponential 10X impact on things that are important to you. Sullivan and Polish are very popular with entrepreneurs, but making my business 10 times larger at this stage of my career is not a goal. But I am passionate about making a 10X impact on the way financial advisors counsel their clients about giving money to worthy causes. You may be surprised to know that many financial advisors discourage their clients from making large charitable gifts. Why? Because advisors fear they’ll have fewer of the client’s assets to manage and they’ll lose out on advisory fees. This mindset is completely wrong, since doing what’s in your client’s best interest is the right thing to do ethically, and usually results in more business for advisors in the long run. I’ve devoted much of my career to changing the way financial advisors think about charitable giving. Still, some habits are hard to break.
Over my career, I’ve helped my clients make over 1 billion dollars in intentional philanthropy. It sounds like a lot, but with so many people and organizations in need, I thought to myself: “Why not raise 10 billion dollars?”
That’s how my new 10 Billion for Charity (10BC) initiative was born. My BHAG (Big Hairy Audacious Goal) is to raise 10 billion dollars for charity before I retire. I’m about 10% of the way to my goal, but if I get to 10 billion dollars too quickly, I’m just going to 10x that until we reach 100 billion dollars. I know that sounds awfully ambitious, but I have some great, influential people supporting me on this quest and we can already see the impact we’re making together.
By the way, I’m “agnostic” about where philanthropic money goes. I don’t compete for capital with other planned giving officers. I simply unearth new capital that otherwise wouldn’t be going anywhere.
Are there three things the community/society/politicians can do to help you address the root of the problem you are trying to solve?
Having help funnel 1 billion dollars to worthy causes over the years, I’m sure that money is having an immediate and longer lasting impact — an impact much greater than if that money had gone to the government in the form of tax dollars. You don’t cure social ills simply by issuing handouts.
As mentioned earlier, I’m trying to change the way financial advisors give advice to their clients and I’m trying to change the way the government hands out money. For financial advisors, it’s all about making sure they incorporate planned giving into ALL their clients’ financial plans — not just their wealthiest clients. There needs to be a systemic change in the way financial advice, legal advice and accounting advice is given. That’s what gets me out of bed every morning!
How do you define “Leadership”? Can you explain what you mean or give an example?
Quite simply, leadership is the ability to inspire people to work toward a common goal. Financial advisors ask me all the time: “How do I even get started on becoming a philanthropic advisor? Where do I begin?”
I tell them to just start talking to clients and prospective clients about their philanthropic intentions. Talk to other advisors and ask them what their goals and dreams are for their philanthropic capital. The more you have those conversations about philanthropy, the more comfortable you get with the concept. Once you do, you’ll start hearing things like “charity begins at home.” I must have heard that cliché thousands of time during my career. We’re not asking clients to take money away from their kids. We’re just trying to get advisors and their clients to understand that there are smart, legal ways to take money away from taxes and inefficient government programs that we don’t necessarily agree with. We want to reallocate that money toward charitable causes we care about.
You are a person of enormous influence. If you could inspire a movement that would bring the most amount of good to the most amount of people, what would that be? You never know what your idea can trigger. 🙂
Again, my 10 Billion for Charity initiative is first and foremost.
I’ve facilitated about 1 billion dollars of philanthropic dollars over my career. That’s a big number that I’m very proud of. But I’m realizing late in life it’s only a start. I’ve decided to set an exponential growth goal — I’m not talking about growing by 10 percent — I’m talking about 10X! No small feat. That will take new skills, new relationships, new thought processes. What do I set my sights on and where do I begin? I want to facilitate 10 billion dollars of new philanthropy before I end my career. Yes, Ten Billion with a B. No small feat, but, if it were easy, it wouldn’t be a challenge.
I many not reach my 10 billion dollars goal, but I’ve got nothing to lose. If I fall short, I can still say I accomplished something and helped a lot of people along the way. And, if I hit the 10 billion dollars number quickly, I promise, I’ll just raise the bar to some new, crazy goal and go for that.
If you want to be part of the 10B C movement, just send me a signal. We’ll figure it out as we go.
Is there a famous person with whom you would like to have a private breakfast or lunch with, and why? He or she might just see this, especially if we tag them. 🙂
I would love have a chat with the Dalai Lama. His viewpoint about compassion, non-violence and helping others has always fascinated me, and it couldn’t be more relevant than it is today.
I would also like to reconnect with the native American medicine man who let me study under him for five years early in my adult life. In Indian lore, the hawk symbolizes vision, power and a higher level of wisdom. Once, during a traditional sweat lodge ceremony, two hawks circled above us as though they were keeping a close eye on the proceedings. I don’t know why, but I began to see things much more clearly after that sweat lodge ceremony and that’s what inspired me to name my firm “Two Hawks.”
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This was very meaningful, thank you so much. We wish you only continued success on your great work!