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Making a Difference With the 5% Solution

Make a Transformative Gift by Leaving 5% of Your Estate to Your Community
Last Will
Photo Credit: Ken Mayer/Flickr

Making a Difference Where You Live, August 29, 2013

 “As we all know, you can’t take it with you, and we can’t live forever, so the transfer of wealth is going to happen anyway whether we make anyone aware of it or not, It’s just going to happen.”  Brian Fogle is President of the Community Foundation of the Ozarks.  Headquartered in Springfield Missouri, and now in its 40th year of operation, the CFO, with grants, scholarships and endowments, facilitates charitable giving across southern Missouri through its 44 affiliate foundations.  The Transfer of Wealth to which Brian Fogle refers, is this:  “It’s what one generation leaves behind for the next, from estate gifts etc.  So when there’s the passing of one generation, how much of those assets will be are being transferred down to their inheritors.  The next 10 years there’s going to be a peak transfer, and it’s the largest peak transfer of wealth in the history of mankind.”

Brian Fogle’s bold pronouncement comes from the Wealth in Missouri and its Counties Study, co-commissioned by the USDA and the 6 member Alliance of Missouri Community Foundations, of which CFO is a member.  The study shows over the next 10 years with the passing of Missouri’s Greatest Generation and an estimated number of first wave Baby Boomers, will result in a 134 billion dollar transfer of wealth.  For the Ozarks, that translates to an estimated 47.2 billion dollars.  Brian Fogle says  “What we want to illuminate is the opportunity for our communities to take advantage of this Transfer of Wealth.”  Enter the 5 Percent Solution:  “What we really want to focus on is how much will you leave behind for your community? How much of a charitable gift will that be?  So, we’re trying  to number one, just saying just think about  leaving  behind just 5%.  And what we want to show through the Transfer of Wealth Study, is that these can be transformative gifts.  Here in Greene County, that 10year transfer of wealth is 6.65 billion dollars, just here in Springfield Greene County. If we capture just 5% of that, it would be 332 million dollars just in the next 10 years that would go to needs in our community.  And these are needs of the donor’s choice weather its education, the arts, the environment, human services, whatever you have a passion for, we’re not being prescriptive on what that is, but we’re asking you leave something behind, 5% for those passions you cared about in life.”

“This effort of these foundations, and what they’re doing and where they’re going, is getting national attention with the US Dept. of Agriculture and with the Secretary of Agriculture”.  Janie Dunning is Missouri’s State Director for Rural Development for U.S.D.A., which kicked in $32,500 for the Transfer of Wealth Study:  “USDA Rural Development made what is called a Rural Business Opportunity Grant in Sept. of 2012.  The balance of the money for the study was paid for by the Alliance of Missouri Community Foundations.  These foundations and this Transfer of Wealth Study for the state is a model, a model for the nation.” 

For those wondering about USDA’s role and interest in The Transfer of Wealth Study, Janie Dunning emphasizes and explains her office’s focus on rural development:  “Our main goal, and who we work with is our rural individuals, businesses, families, organizations and communities.  We provide financial assistance to help with all kinds of things such as housing and broadband and community facilities.  As we have moved through the years, we find that the resources that we have, plus what other financial providers have, is getting less and less.  So what we find ourselves doing is finding other partners and sources we can tap into to bring more resources to the table for rural areas.”

Community Foundation of the Ozarks President Brian Fogle says CFO’s informational road show on the 5% Solution has already begun by reaching out to CFO affiliates.  “We’ve been to numerous communities already, and we do county specific presentations and its eye opening because they’re thinking , oh we don’t have any assets, but when you think about real estate, life insurance or business ownership, it all adds up.  And again, we’re trying to increase awareness but we know this won’t happen just through the efforts of CFO, so we’re working very closely with professional advisors.  The tax attorneys, money managers, and the CPA’s who work with clients on estate planning, and talk with them about how important it is for them to work with their clients to talk about the 5% Solution.  If you haven’t put an estate plan in place and you know you need to, and you’ve been putting it off for the last 5 or 10 or 15years, this is a great opportunity to get motivated to say “I’m going to talk to my attorney or CPA about setting up an estate plan when I’m motivated by this radio program, and I’m going to specifically say let’s leave 5% behind for the purposes of doing something for the community that’s been so good to us, so let’s in turn give something back to the community”. 

According to the Wealth in Missouri and its Counties Study, over the next 50 years, the transfer of wealth amount increases to 565 billion dollars for the Ozarks, and 1.5 trillion dollars for Missouri. 

Support for the Making a Difference Where you Live series on KSMU, comes from the Community Foundation of the Ozarks.  cfozarks.org

For KSMU, I’m Mike Smith.