VOLUME 5, ISSUE 1 | 2009 | WWW.KINGDOMADVISORS.ORG
ON PURPOSE
INTENTIONAL ADVISING FOR THE CHRISTIAN FINANCIAL ADVISOR
Seize the
Day The Opportunity of a Lifetime
The Blessed Advisor What’s Up with Washington? Kingdom Advisors Testimony: Jeff Rogers
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C O N T E N T S The mission of OnPurpose is to deliver engaging content to Christian financial professionals so they are equipped to integrate their faith into their practices and serve their clients by delivering faith-based advice.
FEATURES The Day; The Opportunity Of A Lifetime 4 Seize Money is one of the most personal aspects of a person’s life, and that puts financial advisors in a unique position. Kingdom Advisors recently conducted a survey of members asking about the degree to which they are stepping into that opportunity by bridging the worlds of finance and faith with clients, especially non-believers. The results were very encouraging!
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The Blessed Advisor
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What’s Up With Washington?
During these uncertain times, many financial advisors are having more communication with clients than ever before. This presents an opportunity to move beyond returns and diversification strategies to segue into topics about values, life goals and definitions of success and joy. Find out how to take advantage of your role as “The Blessed Advisor.”
Since President Obama released his controversial budget, advisors all over the country have been overwhelmed with calls about the proposed changes to upper-income taxes, charitable deductions, and estate taxes. While it is not yet clear if Congress will vote these proposals into law, we can be sure that big tax changes are on the horizon.
Growing In Influence
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I N T E N T I O N A L A DV I S I N G F O R T H E C H R I S T I A N F I N A N C I A L A D V I S O R
KINGDOMADVISORS.ORG
The Deeper Meaning Of Life
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Ron Blue President
Kingdom Advisors Testimony with Jeff Rogers
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Bill Serravezza
Community Profile: Chattanooga
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Tony Stinson
LifeLINE: The Opportunity Of A Lifetime to Have a Lasting Impact
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Ron Blue Answers
Q
How do I counsel fearful clients?
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My relationship with my clients has never gone beyond financial in nature. How do I now begin to open up Kingdom opportunities with these clients?
Chief Executive Officer Chief Operating Officer
Kristen Burnett Chief Financial Officer
Rob West
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Editor in Chief
Scott Titus Editor
Kathie Wheat Editor
Kenny Ng Art Director Kingdom Advisors 5605 Glenridge Dr., Suite 450 Atlanta, GA 30342 Tel: 404-497-7680 Fax: 404-497-7685
F E A T U R E
Seize the
A R T I C L E
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THE OPPORT
Money is one of the most personal aspects of a person’s life, and that puts financial advisors in a unique position. Because clients talk to advisors about a subject they are hesitant to talk about with most other people, a bond is formed. That provides opportunities to talk about another very personal subject: faith. Kingdom Advisors (KA) recently conducted a survey of KA Members asking about the degree to which they are stepping into that opportunity by bridging the worlds of finance and faith with clients, especially non-believers. The results were in many ways very encouraging. Numerous KA Members indicated that they regularly discuss Biblical principles of money with non-believer clients. But it also pointed to several areas of opportunity for expanded influence.
Nearly all KA Members surveyed agreed that the Great Commission (Matthew 28:19-20) applies to “everyone, including me”—that the Biblical call to share one’s faith with others is not just for those with the gift of evangelism. And yet, a lesser number of KA Members are proactive in using their work as a platform to share their faith. The starting point in sharing our faith with others is not about techniques. It’s about perspective; it’s about looking at life as a daily opportunity to introduce others to Jesus. And because so much of our time is spent working, it’s about viewing our work as a ministry. Fully 95 percent of Kingdom Advisor Members view their vocation as a ministry either “some” (27%) or “to a great degree” (68%).
How proactive are you in sharing your faith with your non-believer clients? Not at all proactive Not very proactive Somewhat proactive Very proactive
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UNITY OF A LIFETIME The extent to which we view our work as a ministry will impact how bold we are in sharing our faith. If we don’t see our work as a ministry, we’ll probably be pretty passive about it. We may just live our life and hope people notice that our faith matters to us. If we see our work as a ministry to some degree, we’re likely to be a bit more proactive by sending some intentional signals about our faith. But if we see our work as a ministry to a great degree, we’ll look for opportunities to bring up matters of faith.
One somewhat proactive approach is to use a mission statement to let clients know we are people of faith. This was identified by the survey as an area of opportunity, since more than one-third of KA Members do not have a mission statement, and of those that do, 40 percent make no mention of their faith. Here are portions of three KA Member mission statements that clearly state the importance of the KA Member’s faith: continues on page 6
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Seize the
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The opportunity of a lifetime.
“We are committed to honoring God in all we do.” “We accept the call of being ministers to the market place, the extensions of the hands of Christ to minister to those with whom we come in contact in the course of our business activity.” “We have experienced and know the love of Jesus Christ and are committed to represent Him by extending that love to all we come in contact with. For believers, we are called to help them handle money faithfully as good stewards.” Do you have a mission statement on your web site or other marketing materials? Does it mention your faith? Another somewhat proactive way to open up conversations about faith is to share Biblical principles of money with non-believer clients. About two-thirds of all KA Members do this in some fashion “fairly often” (43%) or “all the time” (20%). The most common method is through casual conversations. One of the most common “other” methods of sharing Biblical financial principles with non-believer clients is to give clients appropriate books.
Current methods of sharing Biblical principles with non-believer clients.
continued from page 5
As Kingdom Advisors President Ron Blue has taught, discipleship begins with us. We must understand Biblical principles of money and put those principles into action in our own lives if we are to have an impact on others. However, more than one-quarter of KA Members indicated that they don’t know enough about Biblical principles of money to be comfortable sharing those principles with clients, and less than half (42%) of KA Members say they have incorporated Biblical financial principles into their own lives “very well.” Also holding KA Members back from having a greater spiritual influence on non-believer clients is a lack of knowledge as to where clients are coming from in matters of faith. The survey found that nearly half of KA Members know the spiritual condition of just “some” (38%) or “not very many” (8%) of their clients. It also revealed that only half of all KA Members routinely gather information about a new client’s spiritual beliefs or practices. Among those that do gather this information, the methods vary. Many of the “other” responses involved the use of strategic questions. For example, asking clients about the charitable organizations that they support or about the principles they’ve used to guide their financial decisions so far.
Methods of gathering information about new clients’ spiritual beliefs.
SShare or discuss a relevant book
W questions on a With n new client information form
Through posters or other items on d display in my office
SStrategic Questioning O On marketing materials ((client newsletter, my web site, etc.)
I don’t ask on a new cclient information sheet or in conversation, but I make note of it if they mention something about their faith
IIn meetings in which we discuss ttheir goals and/or my financial recommendations IIn casual conversations
B By asking them aabout their faith in conversation
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One of the greatest privileges any of us will ever have is playing a role in a person placing their faith in Christ. About one-fifth of all KA Members are confident that they have had this privilege with one or more of their clients. In the DVD “Just Walk Across the Room,” Willow Creek Community Church Senior Pastor Bill Hybels describes a nearly 10-year journey of sharing his faith with a friend, Dave, who ultimately placed his faith in Christ. At one point in the process Hybels told his friend, “I’m not going into eternity without you.” He didn’t plan to say it; it just came out—a natural, heart-felt expression of his love for his friend. Dave didn’t fall on his knees in that instant and accept Christ. But it was clearly a key moment in the journey. Think of one of your non-believer clients right now whom you are not willing to go into eternity without. Who comes to mind? What could you do to move further out onto the skinny branches in sharing your faith with this client? It’s your job to help your clients get a good return on their financial investments, but it’s your calling to help them gain an eternal return on the investment of their life.
Matt Bell is a personal finance writer and speaker. He has written two books published by NavPress: “Money, Purpose, Joy” (September 2008) and “Money Strategies for Tough Times” (April 2009). 9). To learn more about his work, visit his web site aatt www.moneypurposejoy.com.
Have you played a role in clients placing their trust in Christ? I pretty I’m ssure that has never happened
Growing in Influence In order to grow in your spiritual influence on your clients, consider completing the Kingdom Advisors (KA) Training and becoming a Qualified Kingdom Advisor™. A recent KA Member survey found trained and qualified KA Members to be more proactive in using their role as a financial advisor as a platform for ministry. For example, when compared with KA Members who have not been through the Kingdom Advisors Training and those who have been trained but have not completed the qualification process, a much higher percentage of trained and qualified Members share Biblical principles of money with non-believer clients “all the time.”
All the time
Not Trained
Trained & Qualified
15%
33%
Qualified Kingdom Advisors™ are also much more likely to bring up matters of faith in the course of their work with non-believer clients, sharing Biblical principles of money during formal client meetings.
In meetings in which we discuss their goals and/or my financial recommendations
Not Trained
Trained & Qualified
54%
73%
When asked why they don’t share Biblical principles of money with non-believer clients, lack of knowledge about those principles was cited by about one-third of KA Members who have not been through the Kingdom Advisors Training. In contrast, lack of knowledge is clearly not an issue for very many trained and qualified KA Members.
I don’t feel knowledgeable enough about the principles
Not Trained
Trained & Qualified
35%
6%
Kingdom Advisors President Ron Blue leads the 16-hour Kingdom Advisors Training in an engaging and flexible web-based format. This professional training offers you a pathway to respond to God’s call on your life to have lasting Kingdom impact through your work. The training is designed to guide you through each phase of a lifetransforming journey so you emerge with the joy of integrating your faith and profession. From dynamic teaching to conceptual models and practical “how to’s”, this training will teach you how to develop a Biblical basis for professional financial advice. More information about the Kingdom Advisors Training is available on the Kingdom Advisors web site at www.kingdomadvisors.org.
I can’t be sure, bbut I doubt it I can’t be sure, bbut it’s possible I know for sure iit has happened
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The Deeper Meaning of Life Ask any small child what is most exciting about Christmastime and the answer will be unanimous – getting presents. When we hear that answer, we all smile an understanding smile and maybe even conjure up a few of our own memories of childhood Christmases long past. But, there is a much deeper level of fulfillment in life than the simple joy a child experiences as he rips open countless brightly colored packages full of wondrous things just for him. I would like to suggest that life’s greatest fulfillment can be found in the deeper meaning of life. The deepest level of fulfillment in life is not found in what we get but in what we give. If you try to explain this concept to small children, they will stare at you with blank looks on their faces, amazed that anything could possibly provide more joy than receiving presents. But, as every parent and grandparent knows, there is no gift you could ever receive that exceeds the joy of watching the bubbling enthusiasm of your own children or grandchildren wildly tear open a box, squeal with glee as they discover its contents, jump up and dash headlong toward you throwing themselves into your arms offering a thousand kisses and thank yous.
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Why should it be any different with the wealth with which God has blessed us? Far too often in our pursuit to build and control our own financial empires, we commonly find ourselves far more focused on what we are getting out of it all than what we could be giving of it. Often, we may find ourselves unconsciously reverting back to a childlike attitude towards happiness – “getting presents for ourselves.” And, in so reverting, we sacrifice the deepest joy in life by neglecting what Jesus told us, “It is more blessed to give than to receive” (Acts 20:35). Notice, He does not deny the blessing of receiving gifts, but He tells us that there is an even greater blessing found in giving gifts. “It is more blessed to give,” He said.
E.G. “Jay” Link The author, E. G. “Jay” Link, is both an ordained minister and the President/CEO of Kardia, Inc., a firm that specializes in assisting wealthy Christian families with the stewardship of all of their life resources. This article is an excerpt from his soon to be released new book, Spiritual Thoughts on Material Things (30 Days of Food for Thought). Mr. Link may be reached via email at jlink@KardiaPlanning.com.
Help your clients move from success to signiďŹ cance...
The Halftime Initiative has been working with h adviiso ors for over two years equipping them to help their clientts move from success to signiďŹ caance. We’vve learned it is difďŹ cult for an advisor to help clients answ wer thee “liffe purposse questioonâ€? if thee advissorr hasn’t done so themselvees. t ) )PX DDMFFBS BBSF ZPV BCPVUU ZPV VS life pu urpose? t "SF ZPV TFFFLJOH NPSF meaning and joy in you ur liffe? t )PX FYBDUMZ EPFT ZZPVS X XPSL ďŹ t into this equation?? If you’ve been ponderring these RVFTUJPOTT SSFDFOUMZ XF FODPVSBBHF ZPV UP FYQMPSF ZPV VS PPXO )BMGUJNF Journey. The peace and fulďŹ ďŹ llment of moving closer to God’s purpose for your second-half will enable you u to better assist clients who want to do the same. Halftime is deligghted UP PGGFS UIF GPMMPXJOH GSFF BE EWJTPS only Halftime workshops: "VHVTU 4BO % %JFHHP 4FQUFNCFS %BMMMBT 4FQUFNCFSS 0 0SMBOEP 4FQUFNC CFS % %FOWFS 0DUPC CFS $ $IJDBHP Jeff Spadafora, Halftime Director of Life Strategy Resources will walk you through tools, models, and processes to help you discover a life of joy and impact-- and become better equipped at helping clients through the same journey. Go to www.halftime.org/fp and look under events for more information and to register.
halftime.org
O N
P U R P O S E
F E A T U R E
In these conversations, you have the opportunity to segue into topics about values, life goals, definitions of success So why have I entitled this article “The and joy. There is no doubt about Blessed Advisor” when you may be it: bad markets present the most feeling less than blessed right now? The reason is because times like these provide teachable moments about life and joy. When Jesus said “It’s lots of opportunities for communication with clients. Most advisors I know have harder for a rich man to go to heaven than for a camel to go been in dialogue with their clients more now than ever before. You now through the eye of needle,” it’s because wealth creates a false sense have more “face time” to have discussions that go beyond security and independence. When people are knocked off balance because returns and diversification strategies (remember when their source of security has eroded, they are those used to actually more open to explore other, truer sources of security. work?). I can only imagine your world right now – decimated markets, dejected clients, timeconsuming stressful conversations.
Asking the “big questions” about a client’s dreams, goals, values, etc. is a common practice among advisors with new clients, but advisors don’t revisit these topics often enough with long time clients. In fact, several research studies on salespeople’s behaviors show that the frequency of asking insightful, penetrating questions with clients decreases dramatically as the relationship matures. This is a big mistake. Moving from an “ask orientation” to a “tell/defend orientation” over time prevents us from staying current on what really matters to our clients.
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Don’t get me wrong, I know people are paying you first and foremost for ROI. I get that. In fact, I spoke with one advisor last week. He said he feels that if he transitions away from the immediate emotional needs of the client, and starts to talk about eternal things, he runs the risk of looking like he’s trying to “change the subject” on the client. Without shirking your responsibility to focus on managing money wisely, this economy still presents a great time for you to revisit those “big picture questions” and have those “gut check” conversations with clients. Don’t miss this opportunity. The trick is to (in fact) change the subject on your client, but do it in a way that is respectful and appropriate given the flow of the conversation. Another advisor I spoke with last week calls this his “Last 10 Minutes.” He told me that he’s been having long conversations – well over an hour – with clients. While he’s been saggeess ffrom rom oot ro theer cl clie ieen ntts ts ha h ave ve engaged in these conversations, he knows urgent messages other clients have been piling up via email and voicemail. Regardless, h hee st stee steels teeeels ls h himself, iim mseelff, tta takes ake k s de d deep eep ep breath and says: “It seems like we’ve covered most of th tthee ur urgent rge gent nt iissues. ssssue uess.. W Wo Would oul ud you be okay if I change the subject for a bit?” (Who’s ggoing oing oi ng ttoo sa ssay ay “n “no” no” o ttoo th that?) haatt?) ?)
Then he asks questions like: “No one’s real happy about what’s h happening ap ppening in the economy right now, it sure reminds ds m mee how little in this world is guaranteed. What’s your our take on that?” “How is this situation impacting your our faith in God?” “What’s your spouse’s reaction to what’s happening?” “How has this situation caused you to re-prioritize what’s important you?” continues on page 12
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The Blessed Advisor
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Granted, you’re going to have some clients who don’t think much about things like this in good times or bad. If that’s the case, back off and let the Holy Spirit take it from there – they’re just not ready. Don’t give up on them. Just “shake the dust off your sandals” and move on (for now).
One wealth advisor that I have been helping coach “Halftime clients” told me a client said:
“I am amazed to find out, in the midst of this turmoil, how much trust I was putting in my net worth.”
But there will be others who are ready to explore a new direction for their life. Those who have come to realize they have been storing up treasure here on earth (Matthew 6:19) and now realize it was a misplaced bet. One Halftimer recently told me: In our ministry (The Halftime Initiative - www. halftime.org), we help Christian marketplace leaders in mid-life transition who have found that the singular pursuit of personal success has gone stale. After being target-locked on the world’s definition of success, they suddenly feel empty. Rudderless. Purposeless. If you have clients that fall into that category, giving them Bob Buford’s book, Halftime, is a good way for them to see words put to their emotions and realize others have traveled this road before.
“I realize now it was all ‘funny money’ anyway and I’m not getting any younger. I want to have fun and make a difference in the world with what I have. I might as well keep on trying to figure out God’s plan for my second half of life.” My encouragement is to gently prompt your clients to “think eternal… to think purpose… to think legacy .. to think NOW, not later.” I’m not suggesting you preach at your clients. I’m suggesting you think strategically about the questions you ask clients. One of three things happens when clients are forced to verbally answer the “big questions” in life: They realize they have long-held assumptions and convictions that still hold true even when the status quo gets shaken up. (Good for them!)
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KINGDOM ADVISORS TESTIMONY Jeff Rogers They realize their assumptions and convictions were flawed and that they need to re-define what they believe. They realize they have no strong convictions about the meaning of life, God, their purpose, etc. The shake-up jolts them out of complacency and creates a desire to arrive at some conclusions. For people in categories 2 and 3, one way to help them is to give them a copy of Halftime. Then, follow up with them after they’ve read the book. If they confirm they’re looking for a new sense of purpose and excitement in their life, contact us at www.halftime.org/fp and I’ll help you brainstorm the best way to help them. So why is it again that financial advisors are blessed? Because not only do you get to be in a profession you enjoy, but you have a wonderful “platform” and relationship base for discipling people and helping them re-discover purpose and meaning in their lives.
Jeff Spadafora (Halftime Director, Life Strategy Resources) spent 19 years as a management consultant to the Fortune 1000. His specialty was change management at the enterprise level by enabling positive behavior change at the individual level. In 2005, Jeff felt God stirring his heart to redirect his energy and skills to make a bigger difference in the world. He was in Halftime. Ultimately, God has made it clear “that Jeff’s calling is to help other people discover their calling.” He coaches people in Halftime, facilitates workshops and speaks to “Halftimers” around the country, and consults with financial advisors who want to integrate Halftime life purpose resources into their service and product lineups. Jeff can be reached at: Jeff.Spadafora@halftime.org.
Jeff Rogers’ clients expect he will offer guidance based on Biblical principles. That’s perfect for Jeff; it allows him to use Kingdom Advisors’ resources to talk with clients about their most personal issues: faith and money. “I believe that the role of the Christian financial professional is a privilege and a calling. I clearly remember the day that God called me away from another vocation and into a lifework that integrated my faith and profession,” Jeff said. “My work is now part of my worship.” He is especially passionate about guiding clients to further the Kingdom through charitable giving. “I make this a priority in my counsel because Christian advisors have a unique opportunity to teach others that God owns it all and we are just stewards of His resources. I have the platform and, thanks to the Kingdom Advisors training, I am equipped to encourage others to give with the confidence that God will reap blessings in their life that are far beyond what they can imagine,” he said. Jeff relies on sophisticated charitable giving techniques so clients not only experience the joy that comes from giving generously, but also benefit from significant tax savings now and enhanced estate plans that include testamentary giving. “From Donor Advised Funds to Charitable Remainder Trusts, Charitable Lead Trusts and Charitable Gift Annuities, there are so many financial tools available to help advisors show clients that taxes are optional, and that money can be redirected toward causes of Christ,” Jeff said. Jeff is a great example of how professional advisors are helping countless people around the country raise the tide of generosity by providing Biblically based financial and life counsel.
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C O M M U N I T Y
syn·er·gy (snr-
j)
n. pl. syn·er
·gies
State in whic h two or mo re agents, entiti es, factors, processes, su bstances, or systems work to particularly f gether in a ruitful way th at produces an effect greater the sum of their individual eff ects.
Thee co Th concept onc ncep ept pt of of ssynergy yner yn ergyy iiss ergy given a lot of attention in the professionall and ministry nd dm iin nis istry try tr worlds. Most have never seen it, and many think it is unattainable. But if you ask the Chattanooga Community of Kingdom Advisors, they will tell you enthusiastically it is a reality! And believe it or not, it can happen in your Community. Chattanooga was one of the first Kingdom Advisors Communities to develop several years ago under the leadership of Martin Pierce, a local attorney. “For years we prodded along patiently with marginal growth and tried to find a way to really connect with Christian financial professionals, but we could never find the right
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P R O F I L E
formula form fo rm to make the impact we all wanted,” notes Martin. While a solid foundation had been laid Maar M Chattanooga, membership and the number in C in members only grew marginally which of ttrained of r was w wa as frustrating. However despite a lack of growth numbers, one of the most important things i n in the Chattanooga Community did during this th he C tim ti time mee was to develop three important local strategic relationships with the Chattanooga Christian re ela latt Community Foundation (CCCF), Crown Financial, Co om Generous Giving. What Martin and his team aand an nd G didn’t d di id dn n’t realize was that the planting of these seeds would wo ou ulld eventually grow and blossom into a movement thaatt iiss now beginning to make a significant eternal th that impact im mpa pact ct in their city. “Connecting with CCCF, Crown, Generous Giving was just part of our Community and an nd G Ge e development plan from the start,” states Merrill Lynch d de eve velo ve l p aadvisor, ad dvi vis issoor, r, Kevin Stophel. “We didn’t see how God would use all of our ministries together down the road wo oul uld u things we couldn’t do alone as Kingdom ttoo aaccomplish ccccom m Advisors Advi Ad v ssoors members,” adds Kevin. vi In n 22008, 00008, 8, things began to change for the Chattanooga Community. Despite the modest Community growth Co Com om mm mun n the developing economic recession, the Community aand an d tth he de d e worked diligently to establish 6 local Study Groups over wor w wo ork rked dd i the yyear, which would set the stage for future growth th the and the development of a deeper Community leadership team. “We knew we had to expand to grow, and we had to develop new local leaders. The Study Groups were the ideal way to make that happen,” says Martin. The Community also began to work more closely with Crown Financial by leading several small group studies for local financial advisors. In addition, several Kingdom Advisors members and potential local giving champions were part of a group sponsored by CCCF, which attended a Generous Giving conference. “Getting this group of key leaders, influencers, and potential giving champions together for this motivating conference was
key to creating a vision of generosity for our city,” said CCCF President Jim Barber. However, one of the most significant developments for the Chattanooga Community was the increased focus of working with the CCCF. Henry Henegar oversees the foundation’s advisor strategy and notes, “We had always been generally supportive of Kingdom Advisors locally because we know the importance of financial professionals in impacting a city. But when we become more intentional, both strategically and practically, with the local leadership, we started to see significant results.” As 2008 came to a close, God was poised to take all this to a new level that no one imagined – synergy. As Kingdom Advisors moved full force into its new ministry model in 2009 with “no-cost” membership and national training scholarships, Chattanooga emerged as a priority city due to its development potential. Fresh off the 2009 Annual Conference in Atlanta, Kingdom Advisors worked with the Chattanooga Community and CCCF to develop a series of events that now has become a model for other Kingdom Advisors Communities. One of the most significant parts of this model was the generous offer of a local training scholarship from CCCF, which was added to the Kingdom Advisors national scholarship g p – reducingg Kingdom Advisors th the he tr ttraining aaiini ningg ccost o t too oonly os nly nl ly $2 $2500 ffor $250 or a K or in ngd g om mA d is dv i or ors ors member Chattanooga area. Att a llu lunch event with m me mb beerr ffrom room th rom the Ch the hat atta tan ta nooog oga aar oga rea e . A unc nch h eev veen ven nt wi ith th Ron Blue February Ron CCCF announced Ro R on Bl B lu uee oon n Fe F Febr ebbrru uaary ry 226th, 6th 6t th, h, R oon n aand nd n dC CC C CF an nnoun noou n un nce ced
this exciting offer and over 40 professionals took advantage of the joint scholarship. In addition, over 50 new members joined Kingdom Advisors. In a matter of weeks, the Chattanooga Community would see its membership increase almost 200% to over 70 members, and more importantly, the number of trained members grow to over 50 from 14. “While the numbers from the Chattanooga lunch are certainly impressive, what is really exciting is the future impact of the new members and training scholarships - more Study Groups, more leaders, and more financial professionals integrating Biblical wisdom into their client advice,” states Randy Glass, Kingdom Advisors National Community Director. “The Chattanooga Community has been taken to a whole new level as a result of working with CCCF and other local partners, and I can see this same thing happening in Communities all across the country.” The ultimate desired result of these exciting developments is much greater than just Kingdom Advisors. Clients and families will be changed with Biblical financial wisdom, new leaders will emerge to advance the Kingdom, and charitable giving and generosity will increase. So, is synergy a myth? No doubt it is rare and hard to come by, but it is a reality. Kingdom Advisors g Communities are position C Co omm omm mun unit itiees aar it re in in a ggreat rreeat at po p osit os itio iiooon n too ffoster oste os ste ter th tthis his his divine synergy working closely with Christian di ivi vin nee ssyn n y er yn e ggyy bbyy wo orrkkin ing cl los osel eelly w wi ith ith h llocal ocal oc al C hris hr isti tian an Crown Financial, Generous Giving ffoundations, fo ounda unda un dattiion ion ons, s, C rroown wn F inan in ancciial al, G Ge en neeero rou ro uss G ivviin ng an aand nd giving champions, Chattanooga Community has ggi ivviin ngg ccha hamp ha hamp mpio iion on nss, as as tthe hee C h hatt ha attttan anoo noo ooga ga C omm om muni mu uni nityy h aass done. When these groups together with prayer, do on nee. W hen tth he heesse gr roou ups ps ccome om me tto oggeeth therr w iitth pr p rayyer, er, er intention, God vvision, visi vi isi s on on, n, in nte tent ent ntio ion io n,, ccooperation oope oo p raati tioon n aand nd d ffocus, occu ocus uss, Go G od ca can doo ssome can oom me things! aamazing am azziin ng th hin nggss!
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Since President Obama released his controversial budget, advisors all over the country have been overwhelmed with calls about the proposed changes to upper-income taxes, charitable deductions, and estate taxes.
Let’s take a look at the three primary areas of proposed changes, as well as a fourth proposal regarding private foundations, and what it all means for you and your clients:
While it is not yet clear if Congress will vote these proposals into law, current economic challenges along with unprecedented government spending will undoubtedly feed an insatiable governmental appetite for more revenue. So we can be sure that big tax changes are on the horizon.
1) Tax Increases The proposal includes a tax hike, increasing the highest marginal tax rate from 35% in 2010 to rates as high as 39.6% in 2011. Increased taxes on capital gain income could grow from 15% to 39.6% as well. • Gifts of appreciated assets prior to the sale would become even more attractive, allowing your clients to avoid more capital gains tax. • Charitable remainder trusts and charitable gift annuities would become more prevalent as these vehicles are used to avoid capital gains tax upon the sale of an appreciated asset, while providing a continuing income stream to the giver.
2) Lower Limits on Charitable Deductions It’s proposed that the benefit for taxpayers who make $250,000 or more be limited to 28%, beginning in 2011. So if one of your wealthy clients gets an extra $100 of income and donates it to charity in 2011, the extra $100 would be subject to a nearly 40% federal tax rate. But their charitable gift would only produce a $28 deduction. So they must spend nearly $12 in taxes to make the gift. Therefore, the “cost” of giving would go up.
3) The Estate Tax Freeze In 2009, President Obama hopes to pass legislation that would freeze the estate tax exemption at its current level of $3.5 million and at its current rate of 45%, with no repeal of the estate tax which was scheduled to go away in 2010. Wiser estate planning with options for transferring wealth while still living will be essential for those with estate values beyond this exemption. 4) Greenlining
There is strong bipartisan opposition to this proposal, and many observers do not believe it will pass. The bottom-line is you should look for opportunities to help your clients give income-producing assets so that income is removed from their individual tax returns and passed directly to charity.
Efforts are underway by several groups to impose restrictions that could have a major impact on your clients who operate private foundations. The Greenlining Institute is lobbying for proposals that would require private foundations to make mandatory grants to certain “disadvantaged” groups, and require diversity in the sexual orientation of the foundation’s management and grant recipients. The Alliance for Charitable Reform was established in 2005 to provide an emergency response to the greenlining effort (visit www.acreform.com to learn more). But overall, the result is that many private foundations are terminating in light of this new threat to philanthropic freedom. continues on page 18
continued from page 17
Planning Opportunities for Challenging Times
So the real question is, what should you do? To help you plan in this challenging environment, here’s a checklist of strategies to use: •
Recommend a donor-advised fund – Now is the time to help your clients establish a donor-advised fund, if they don’t have one already. If they are able to pre-fund their giving, they can get tax savings at a 35% rate for their contributions to the fund before 2011, and then recommend grants in later years when their charitable gifts would have only produced a 28% rate tax savings.
•
Suggest a Charitable Lead Trust (CLT) – A CLT is an ideal option now for transferring wealth to both family and charity because the “hurdle rate” – the rate that the IRS uses for CLT calculations – is at an all-time low (under 3%).
•
•
Offer a Charitable Gift Annuity (CGA) – CGAs are good for individuals that need a higher, more stable annual income. CGAs are particularly attractive today due to the volatility in the stock market (primarily spiraling downward), and the very low interest rates on most fixed income investments such as CDs, money markets, and government bonds. Flexible and deferred CGA options offer additional attractive planning strategies. Use the “Give & Hold” strategy – Many business owners have a heart to give but are hindered by their limited cash flow and the high taxation of their business. But there is a way to help private business owners maximize their giving and tax savings, as well as increase their cash flow. Through the Give and Hold strategy, your client can donate a non-voting interest in their business
to a donor-advised fund. Because the donor-advised fund is a public charity, they receive a fair market value tax deduction for the gifted interest. Due to the tax savings from their deduction, their cash flow is increased. If their business is growing, they can utilize this strategy every year and only give a portion of the annual appreciation in the business. And because it is a non-voting interest, they maintain control. •
Maximize deductions with non-liquid gifts – Tax rules allow donors to deduct up to 50% of their adjusted gross income (AGI) for cash contributions. But an often neglected provision of the law allows for 30% of this total 50% AGI to be given in the form of non-cash assets. These rules can be leveraged to remarkable effect. For their nonliquid gift portion, they not only get a tax deduction now, they also avoid capital gains tax when the appreciated asset is eventually sold.
•
Take advantage of the Charitable IRA Rollover – If it is extended, the Charitable IRA Rollover will be especially attractive in 2011 and later years (if deduction benefits are reduced to 28%). A gift of the IRA does not require income to be reported on the giver’s individual income tax return. This will allow your client to keep their taxable IRA distributions out of their income, and could effectively save them 12% on each gift. Although this opportunity is currently set to expire on January 1, 2011, there is strong support to extend it. There is also pending legislation that would enhance the current rules allowing more taxpayers to benefit, and
Kingdom Advisor members have a unique and highly leveraged opportunity to impact clients. When meeting with those who have a passion for investing in eternity, please tell them about Overseas Council, a ministry partner of Kingdom Advisors. We would be happy to arrange a meeting to introduce you and your clients to OC and its worldwide ministry.
www.overseas.org/contactus allowing greater overall flexibility in planning with this asset (including the use of CRTs and CGAs). •
Offer solutions for private foundations – Clients who have a private foundation need to know about “greenlining” (see page 17), and how to avoid its potential effects. For those who maintain a balance under $1 million and have no employees, their best alternative might be to close their foundation and use a donoradvised fund to accomplish their giving. They can grant anonymously and avoid public scrutiny, as well as many other administrative hassles and IRS restrictions. Another option is to move the majority of the foundation’s assets to a donor-advised fund and keep a small amount in the foundation, adequate enough to fully distribute each year and qualify as a conduit private foundation (under Internal Revenue Code 170(B)(1)(F)).
Whatever you do, it’s wise to engage clients now. Help them plan today in order to preserve tax benefits for gifts made prior to these anticipated tax law changes, and they will be grateful for years to come.
The National Christian Foundation can help you put these strategies to work in your practice. For more information, please call 800.681.6223 or visit www.nationalchristian.com.
David Wills David Wills has practiced law since 1988 and currently advises numerous families and several major Christian ministries, helping donors with gift and estate planning. His primary areas of practice for the last 17 years include charitable gift planning, exempt organizations (specifically in the public and private foundation arenas), estate planning and fiduciary-related matters. David joined NCF in 1998, having previously served as director of gift and estate planning at Focus on the Family. He is also Of Counsel with the 200+ member law firm Thompson & Knight, L.L.P. in Dallas, Texas. David lectures throughout the country on issues involving foundations and nonprofit organizations, the transition of wealth, responsibility from one generation to the next, and tax and spiritual issues in charitable giving. He earned his B.B.A. from Baylor University and his J.D. from Baylor Law School and completed post-graduate work at Dallas Theological Seminary. David serves on several boards, including Generous Giving, Hope for the Heart, and the ProVision Foundation.
KINGDOM
TRAINING
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PROGRAM
For Such a Time as This Now more than ever before, people are seeking financial professionals of all disciplines who can offer peace of mind in the midst of economic uncertainty… professionals who are trained to respond to their concerns while sharing the incredible opportunities for Kingdom impact. Kingdom Advisors Training is uniquely positioned to train Christian financial professionals for a time such as this. Professional training offers you a pathway to respond to God’s call on your life to have lasting Kingdom impact through your work. The training is designed to guide you through each phase of a life-transforming journey so you emerge with the joy of integrating your faith and profession. From dynamic teaching to conceptual models and practical “how to’s,” this training will teach you how to develop a Biblical basis for your professional financial advice.
What Others Have Said About the Training “The simplicity, power and truth of the Kingdom Advisors Training has rocked my world – and I absolutely love it. I’ve learned to talk with my clients in a whole new way. This training has presented me with an incredible new tool – not unlike learning to use a new computer.” Richard Voit, CIMA, Chicago, IL “I just finished Kingdom Advisors Training and I can’t tell you how much I have learned through this process. I wish I could have done it 30 years ago… but it’s never too late. I’ve already started to apply the principles I learned in my business, church and family life, and I am starting to feel the positive impact!”
“It was the most valuable training to which I have ever been exposed. Right from the first video, I’ve been implementing things I learned.” Tim Jenkins, CFP®, Peterborough, ON “What an incredible blessing to have Ron Blue’s mentoring and training in this on-demand format. I am able to review it over and over again to practice for presentations, to make it my own and to deliver it with confidence. What a blessing!”
Miguel J. Rodriguez, CPA, PFS, Plantation, FL “This has been the most edifying training process that I have ever experienced. I approached this study professionally - with the anticipation of learning the Biblical principles that I need to be communicating to the donors that I work with and I completed the training with so much more! This training has uncovered what I believed about financial matters.”
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Kingdom Advisors OnDemand Training Includes: • Comprehensive Training Workbook • Scriptural Reference Guidee • Monthly Coaching Calls with Ron Blue • OnDemand Access 24/7 ™, and CIMC™ • 20 hours of CFP™, CIMA™, dits. Continuing Education Credits.
TRAINING COST - $1,500 Monitor, computer, and keyboard not included.
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The Opportunity Of A Lifetime To Have A Lasting Impact Simply put, like other ministries Kingdom Advisors is dependent on charitable support and financial contributions for our ongoing operations. This is your opportunity of a lifetime to take ownership of a growing ministry that is changing lives for the Kingdom! As an unprecedented number of Christian advisors, now over 3,300, tap into our resources and seek our counsel to help them integrate their faith and their work, our financial needs have increased. In order to service all those who rely on Kingdom Advisors for daily guidance, as well as enhance outreach and services, we must ask those who have benefited from the ministry to sow their God-given resources back into the organization. Rest assured, we have been good stewards and proactively cut expenses by over 20% by implementing cost saving strategies. It is not enough. Each month, your ministry needs $40,000 in financial support.
Consider the impact this ministry has had on helping you fulfill your calling. Then decide what you can contribute – in a recurring monthly or annual gift – to unlock the power of enhanced services and outreach to more advisors so they, too, can learn how to share Biblical stewardship in their world. Please support Kingdom Advisors the way Kingdom Advisors has sustained you throughout your journey. We need your gift today. Take a moment right now to visit www.kingdomadvisors.org/donate. Your support of this movement can have a lasting impact on the lives of advisors, families and most significantly, God’s Kingdom. Thank you for your prayerful consideration to support Kingdom Advisors!
Using your generous gifts for the greatest impact, Kingdom Advisors will grow membership, expand outreach into local communities, support more study groups, develop new training content and, most importantly, ignite a passion and purpose in more Christian financial professionals across the country.
Discover the Art of Financial Services
Ariis Aris
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Aris
Year Years rs of Cl C ient ie nt Client Se rv ce Service
1974 19 974 - 2009 200 09
Investment, Retirement and Trust Services Serving Fee-Based Financial Advisors with: Advanced Risk-Managed Portfolios Manager Research and Due Diligence Traditional, Socially Responsible, Faith Based and Biblically Responsible Portfolios Portfolio Investment and Transition Strategies Client Proposals and Paperwork Quarterly Rebalancing and Reporting Retirement Plan Design and Administration Including Faith Based 401(k) Options
Contact Keith Weir
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kweir@ariscorporation.comK I N Gwww.ariscorporation.com DOMADVISORS.ORG | 21
RON•BLUE
RON BLUE ANSWERS QUESTIONS F
Q
A
“How do I counsel fearful clients?” I have seen fear in my clients’ eyes throughout the 40 years that I’ve been providing financial counsel. Rest assured that fear itself is not a new phenomenon. Yet, it tends to “rear its ugly head” during times of uncertainty. In fact, many advisors tell me that it seems their clients are driven and consumed by fear, and in some instances make hasty decisions that are not really in their best long-term interests. As advisors, we have the opportunity – and the responsibility – to put that fear into its proper perspective by reminding clients that God is neither surprised nor worried by what is happening in our financial markets. Talk with your clients about their fears. Ask them, “What is the worst thing that you can imagine happening? If that fear becomes reality, then what is the worst thing that you can imagine happening?” For many people, the worst thing they can imagine is dying. Yet, as Paul reminds us in Philippians 1:21 “For to me, to live is Christ and to die is gain.” So even in death, we have nothing to fear.
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I am not suggesting that advisors play down or belittle clients’ fears about shrinking portfolios. What I am suggesting is that fear of losing one’s worldly finances needs to be viewed from a healthy perspective. It can indeed be devastating to see a retirement account virtually disappear or watch a college savings account dwindle, a situation that is exacerbated by stress about what the future holds. However, as Christians we know that we do not need to let these fears consume our lives, hearts and minds. God is in charge and He will provide for us into all eternity. Someone once said to me that fear exposes a person’s idols. People who worship money are most afraid of losing their money. Yet, if we truly worship God, we know we are secure because He will never leave us and we will never be lost to Him. So, another element of this conversation is to ask your clients, “What do you really worship?” In the Bible, there are more than 80 instances of God’s word telling us “do not fear”, and each time, fear does not win. Acknowledge your clients’ fear and let them know that it’s normal to experience it. Then ask clients to focus on how they plan to respond to their fear. Work with them to keep it in its proper place by making prudent decisions based on Biblical financial principles and remembering that God loves them and will take care of them, regardless of the size of their portfolio.
•ANSWERS
FROM FINANCIAL PROFESSIONALS Q
A
“My relationship with my clients has never gone beyond financial in nature. How do I now begin to open up Kingdom opportunities with these clients?” This is a dilemma facing many Christian advisors who know that they have so much more to offer than financial counsel. When you have integrated your faith and your work, it’s a natural inclination to want to open up the world of Kingdom opportunities to those who may never have considered them previously. There may indeed be sensitivities when talking to a non-Christian about spiritual issues, so acknowledging that up front can help advisors plan how to approach these clients. The key lies in reflecting on and being able to articulate your own priorities and testimony, because this enables you to incorporate your personal perspective into the conversation. Take the time to contemplate your convictions so that when the opportunity arises, you can describe how you have applied your beliefs to your own life, with amazing results.
I’ve never felt I had to force a discussion about “spiritual issues” because asking the right questions, and then taking the time to listen to the answers, gets the conversation started. As in my experience, you will probably find that many clients are not against discussing these topics; they just have never had a financial advisor bring them up before! That’s why it’s good preparation to have your convictions top of mind -- clients will inevitably ask for your wise counsel in this area. Approach these opportunities with excitement and anticipation for enacting change in one another for the good of the Kingdom. Know your own Biblical priorities and convictions, and remember that God is at your side, always faithful in answering the prayer of James 1:5, “If any of you lacks wisdom, he should ask God, who gives generously to all without finding fault, and it will be given to him.”
The next step is to ask these clients in-depth questions about their priorities, values and goals so that together you can begin to delve into issues deeper than just their financial concerns. Help clients understand that when you know the motivations behind their decisions, you become more educated about their life priorities and goals – not just their financial goals. And that makes you better equipped to provide comprehensive counsel to help them not only reach their financial finish line, but also achieve their dreams.
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PASSION & PURPOSE
KINGDOM ADVISORS 2010 ANNUAL CONFERENCE
As a Christian financial professional, you more than anyone know the extraordinary role dom that you play in the lives of your clients. At Kingdom Advisors, we are committed to equipping you to ngdom maximize the opportunity you have to realize Kingdom 0 impact as you serve clients every day. Our 2010 Annual Conference, “Passion & Purpose”, now inn its othe herr 6th year, is your opportunity to join hundreds of ot other nitityy to professionals from the Kingdom Advisors community grow in your faith, network with other professionals and learn new ideas for your clients and practice.
Richard Blackaby
Ron Blue
Bob Coy
FEBRUARY 9 - 11, 2010 OMNI HOTEL AT CNN CENTER • ATLANTA, GA
Anne Graham Lotz
Patrick Morley, Ph.D.
Bob Shank
Al Weiss
These are just a few of the special events and sessions we have planned. Early registration is coming soon: KingdomAdvisors.org/2010. Kingdom Advisors 5605 Glenridge Dr., Suite 450 Atlanta, GA 30342
FIRST CLASS PRESORTED U.S. POSTAGE PAID PERMIT #3259 ATLANTA, GA
• Breakout workshops on practice management, discipling clients, investing, charitable giving, spiritual growth and more • A special presentation from Bob Doll, Vice Chairman and Global Chief Investment Officer for Equities at BlackRock, Inc., on the current market and economic environment • All new case studies • Unique social opportunities allowing you to network with other committed Christian financial professionals • Kingdom Advisors Community Group Meetings
5605 GLENRIDGE DR., SUITE 450 • ATLANTA, GA 30342 KingdomAdvisors.org T: 404-497-7680 • F: 404-497-7685