By Andrew Comstock, CFA®
Most of the charitable giving conversations I have with clients don’t begin with tax strategy.
They begin with a puppy.
You’ve probably been there yourself. You’re at a charity auction, having a wonderful evening, and then they bring out an adorable golden retriever puppy. The bidding starts. People laugh. The paddles go up. And before anyone has thought twice about it, they’ve pledged $2,500 to a cause they hadn’t considered that morning.
Reactive giving like this isn’t wrong. Generosity in the moment is admirable. But for high-income professionals and business owners who genuinely want their giving to matter, who want it to reflect their values and strengthen their family, a one-off donation here and an impulse pledge there is rarely enough. What’s missing is a framework.
You don’t need to wait until you’ve “made it” to give strategically. You need a repeatable approach that fits your life now and scales as your wealth grows. These are the principles I use when working through charitable giving intentions with clients at Beyond Wealth.
Start With Clarity of Purpose
Before you can give well, you have to know why you’re giving. That sounds obvious, but most people skip this step and spend years writing checks without a coherent strategy behind them.
I encourage clients to think of this in the way we think about constructing an investment portfolio.
Just as a well-constructed portfolio has a clear mandate and purpose, your charitable giving deserves one too.
- What causes matter most to you?
- What communities do you want to impact?
- Are you drawn to faith-based organizations, education, health research, social causes, community development, or something else entirely?
Consider writing a giving mission statement that captures your priorities and the values behind them. Your mission statement could be a few bullet points or a one-page document that provides some context around your “whys.” When you have that document, saying no to scattered requests becomes much easier, and saying yes becomes more intentional. When your teenager’s school, your church, your neighbor’s 5K, and three mail solicitations all arrive in the same month, you’ll have a clear filter for where your generosity actually belongs.
Think Long-Term, Not Transactional
Episodic giving, the kind where you respond to whatever crosses your desk that year, tends to produce scattered impact and donor fatigue. A more sustainable approach is to establish recurring commitments tied to your income.
One framework I find useful is targeting a percentage of gross income for charitable giving annually, and then treating it like a line item in your financial plan. A common starting point is 1–3% of gross income for high-income households, scaling upward as income and wealth grow. Some clients tie a portion to annual bonuses or equity vests, which aligns giving with liquidity events rather than disrupting monthly cash flow.
Within that commitment, I’d suggest reserving a small allocation, perhaps 10–15% of your total giving budget, for opportunistic gifts. The puppy at the auction, the unexpected GoFundMe from a colleague in need. The remainder flows to your defined priorities from Principle 1.
Sizing your giving against your overall wealth-building plan is critical. Generosity is a wonderful thing; generosity that creates financial stress or forces you to delay retirement goals is not an optimal strategy. We help clients find the balance.
Be Strategic With the Vehicle
How you give matters almost as much as how much you give. The right vehicle can multiply the impact of every dollar without requiring you to give more out of pocket.
Donor-Advised Funds (DAFs) are the tool I recommend most often. With a DAF, you make a contribution to the fund in one year, receive the tax deduction immediately, and then distribute grants to qualifying nonprofits over time. This is especially valuable when bundled with a “bunching” strategy, where you combine two or three years of charitable contributions into a single year to clear the standard deduction threshold and new OBBBA rules regarding charitable gifting. Because charitable contributions are now subject to a 0.5% income threshold before deductions begin to provide a tax benefit, we are increasingly recommending that clients bundle or bunch multiple years of charitable gifts into a single year.
For clients who hold appreciated stock, RSUs, or concentrated equity positions, contributing shares directly to a DAF rather than selling first and donating cash is often far more tax-efficient. You avoid recognizing the capital gain entirely, and the charity receives the full pre-tax value.
Questions about private foundations come up occasionally, and while they offer noteworthy control and legacy benefits, the administrative overhead generally makes them impractical for giving commitments below roughly $5 million.
One important framing point: tax efficiency is a benefit of thoughtful giving, not the goal. The goal is impact; the strategy just helps you get more of it.
Focus on Impact, Not Just Intent
When I wear my CIO hat at Beyond Wealth, I spend a considerable amount of time evaluating investment managers. We asked hard questions about their process, their track record, their team, and how they managed risk. I believe the same due diligence rigor belongs in charitable giving.
When evaluating a nonprofit, I look at a few dimensions:
- Leadership quality: Is the organization run by capable people with a clear mission?
- Measurable outcomes: Can the organization demonstrate that its programs are producing results?
- Financial stewardship: A nonprofit’s Form 990 is publicly available and reveals compensation, revenue sources, and how money is allocated.
One word of caution: overhead ratios, the percentage of spending that goes to administration versus programs, are commonly cited but can be misleading. A nonprofit that invests in strong leadership and systems may show higher overhead while producing far better outcomes than a bare-bones operation. Look at the full picture, not just one number.
The goal is to give with both your heart and your head. Emotional connection to a cause is important. Confirming that the organization can channel your gift toward genuine impact is an equal priority. Don’t feel like you need to become a charitable giving expert before making a donation. As you continue your giving journey, you’ll likely learn more about the organizations and causes that matter most to you.
For some people, that means simply supporting a charity they trust. For others, it means researching an organization’s impact, reviewing its finances, or asking questions before making a gift. Both approaches are perfectly reasonable. The goal isn’t to become an expert, it’s to give thoughtfully and in a way that feels right for you.
Use Philanthropy to Transfer Values
Many of my clients have children still at home, ranging from elementary-school age to college. And while estate planning conversations about leaving a charitable legacy are important, the more immediate opportunity is happening right now, around the dinner table.
Charitable giving is a powerful way to teach children what your family actually values. Not what you say you value, but what you invest in.
When kids see their parents deliberating over where to direct resources, visiting the organizations they support, and talking openly about why those causes matter, those lessons tend to stick.
Some practical approaches I’ve seen work well with families:
- Hold an annual family giving conversation where everyone (including kids) shares causes they care about.
- Let children direct a small, defined portion of the family’s annual giving to a cause they choose.
- Visit the organizations you support together so the impact feels real and personal.
- Draft a simple family statement of values that informs how and why you give. This could also just be your mission statement as well.
The goal here is generational continuity of values. You are not just transferring wealth over time; you are transferring a way of engaging with the world.
How Much Is Reasonable Charitable Giving at This Stage?
This is one of the most common questions I get, and I want to answer it without being prescriptive, because every family’s financial picture is different.
As mentioned above, a reasonable starting point for many high-income households is 1–3% of gross income annually. That range tends to be significant without compromising other goals. As income grows, many clients find it natural, and financially feasible, to scale toward 5% or more. Tying incremental giving to bonuses, equity vests, or other windfalls is a practical way to grow your generosity alongside your wealth.
The families I’ve worked with rarely remember the tax deduction years later. What they remember are the causes they helped advance, the conversations around the dinner table, and the values they passed to the next generation.
The most important thing is to make the decision intentionally within your comprehensive financial plan, not reactively. When charitable giving is integrated into your overall financial strategy, it becomes sustainable across market cycles, meaningful to your family, and aligned with everything else you’re working toward.
At Beyond Wealth, we work with high-income professionals and business owners to build financial plans that go beyond the numbers, ones that reflect your values, your priorities, and the legacy you want to leave. If you’d like to talk through how charitable giving fits into your overall financial picture, don’t hesitate to call (913) 871-7980 or email andrew@beyond-wealth.com to schedule a time to meet.
Frequently Asked Questions
How much should high-income earners give to charity each year?
There is no single right answer, but a practical framework for high-income households is to target 1–3% of gross income as a baseline, with the flexibility to scale upward as income and wealth grow. Tying charitable contributions to annual bonuses or equity vests is a common approach that aligns giving with liquidity rather than disrupting monthly cash flow.
The most important step is integrating charitable giving into your overall financial plan so it remains sustainable across market cycles and consistent with your other financial goals.
What is a donor-advised fund and how does it work?
A DAF is a charitable giving account sponsored by a public charity. You contribute assets, receive an immediate tax deduction, and then recommend grants to qualifying nonprofits over time. DAFs are particularly useful when paired with a “bunching” strategy, where multiple years of charitable contributions are combined into a single tax year to exceed the standard deduction threshold. Contributing appreciated securities directly to a DAF rather than selling first can also eliminate capital gains taxes while maximizing the value of your gift.
Is it better to donate appreciated stock or cash to charity?
For assets that have appreciated significantly, donating the shares directly to a qualified charity or donor-advised fund is generally more tax-efficient than selling the stock and donating the proceeds. When you donate appreciated securities held longer than one year, you avoid recognizing the capital gain, and you receive a deduction for the full fair market value of the shares. This approach effectively allows more of your gift to go to the charity rather than to taxes.
How do I evaluate whether a nonprofit is worth supporting?
Start by reviewing the organization’s publicly available Form 990, which details revenue, compensation, and how funds are allocated. Beyond the numbers, look at the quality of the leadership team, whether the organization tracks and communicates measurable outcomes, and how transparent they are about their financials.
Be cautious about relying too heavily on overhead ratios as a standalone metric; a well-run organization may invest more in administration while producing far better results than a leaner operation. Thoughtful due diligence safeguards both your generosity and the causes you care about.
How can I involve my children in charitable giving?
An effective approach is to make giving a visible, family conversation rather than something that happens invisibly in the background. Consider holding an annual family discussion where each person shares causes they care about, and let children direct a small portion of the family’s giving budget to an organization of their choosing.
Visiting the nonprofits you support together can make the impact tangible. Over time, these practices help children develop a genuine understanding of generosity, values, and financial stewardship that shapes how they engage with money throughout their lives.
About Andrew
Andrew Comstock, CFA®, is a Principal and Wealth Advisor at Beyond Wealth, a fiduciary financial advisory firm based in Overland Park, Kansas. Leveraging a strong background in institutional investment management, he specializes in creating research-driven portfolio strategies for wealth-building professionals and business owners. A University of Tulsa alumnus, avid global traveler, and proud cancer survivor, Andrew delivers tailored, impactful wealth management to the Kansas City area and beyond.
