Local Baby Boomers’ Estates Could Have Huge Impact on CNY if Small Percent Goes to Community

Dec 16, 2016

People could help Syracuse and CNY thrive if they named a portion of estates to local non-profits and philanthropies. $20 Billion of wealth is expected to be transferred in the region over the next decade, even a small portion of which could help arts, human services, environment and other organizations.
Credit visitsyracuse.com

As people think about holiday giving…they might want to think about the legacy they can create long-term.  Central New York’s Baby Boomers will be leaving behind billions of dollars over the next decade, according to a study of local personal worth.  Even a small percentage of that wealth, if bequeathed to charities and other non-profits, could make a big difference in the community.

Linda Dickerson Hartsock has spent a lot of time thinking about – and working for – a better community.  She’s had jobs in community development in the Hudson Valley…and has worked here in Syracuse and at her home in Homer on revitalization, helping youth and improving things.  When the baby boomer hit a milestone birthday, it caused her to think about it a bit further.

Linda Dickerson Hartsock with her son.
Credit cnycf.org

“What’s the legacy we want to leave behind, particularly if we’ve been folks who are really active, as this generation has been?  We’re the generation that started out in the 60s and 70s as the idealist generation, who wanted to change the world.  It’s kind of nice to come full circle and think about how we do that at this point in our lives.”

Hartsock decided to set up a fund to have some of her estate, once she passes on,  go for things she believed in and worked toward.  Part of the process of setting up the fund at the Central New York Community Foundation was writing a letter: what’s important to her…and what might happen with what she’s leaving behind.

“It also became a document that I shared with my children, so that they had a better sense of who I was and what I did and what was important to me.  And it was such a rich, meaningful experience to do.  You’d think it would be sad or poignant; it wasn’t.  It was completely uplifting to be able to do this.”

We’ll get back to Linda’s story in a minute.

Community foundation Executive Director Peter Dunn says there’s a lot of wealth in the personal estates and accounts of people here in CNY.   How much?  A 2011 study by the Center for Rural Entrepreneurship found total net worth of people in our five-county region totaled 57 (B) billion dollars.

“About 40 %, a little over $20 billion, is going to transfer over a 10-year period…so that’s a significant amount of community wealth.  And that made us think about, ‘o.k. where’s that going to go?  And when people have decisions to make about how they allocate their resources, irrespective of the size of the estate and the financial resources they might have, what kind of decisions are they going to make?’”

To whit…How might that affect their community?  Well here’s an example

Tymeik Johnson has been coming to the Boys and Girls Club of Syracuse for years…does homework, gets some recreation…and some opportunities he might not otherwise.

“We earn to go places, when we do good.  We go to places like a Christmas party or to Lights on the Lake.”

Tymeik’s a fifth grader…India Jackson is a seventh grader who comes after school.

“I do homework.  I help out, we do games with the little kids and we have fun.  I like Smart Girls.  When the girls get together, we do a lot of stuff and we talk about what we should do when we get older.” 

Boys and Gils Club Syracuse members and staff at a recent fundraiser at Barnes and Noble.
Credit https://www.facebook.com/BGCSyracuse/

Smart Girls and Passport to Manhood are for leadership and self-confidence; a STEM program and Career Prep help with learning and build job skills.  Boys and Girls Club Development Director Jennifer Jock says the programs are valuable for a number of reasons.

“We want to make sure that we are providing educational and enrichment programs.  But more than that I think a lot of people don’t realize that our kids live in poverty and they’re hungry every single day.  We feed them every day a snack and dinner after school and during the summer we feed the breakfast, lunch and dinner.”

Collaborations with the food bank and other partners help…but Jock says individual and foundation donors  are also essential. 

“I think when they actually set foot in these doors and they see what the kids go through day-in and day-out, and then we’re here as a safe-haven, that safe environment, make sure our kids understand healthy life skills, becoming responsible citizens.” 

When people think about what to do in charitable giving or estate planning they might see an attorney like Ann Ruffer, a partner at MacKenzie Hughes Law firm in Trusts and Estates. 

“I don’t tell anybody what to do, however, I will ask them if they are charitably inclined.  And if somebody (notes), ‘Yes I’m charitably inclined, but I’m not sure how to set something up,’ I will suggest things they can research further.”

Of course they might have an affinity for a charitable organization with which they were involved…a college or medical institution, a religious group or one that helps animals or children.  But Ruffer finds not everyone thinks of their community.

“There are people that live here, but because people move around so often, their children don’t live here.  So when they leave their wealth to their children, that money is going to leave the community.  It is an astounding figure to think how much wealth can leave the community.” 

CNY wealth study shows the amount of money leaving the community if people bequeath it to heirs who live outside the region.
Credit cnycf.org

Don’t even mention that to the Community Foundation’s Peter Dunn.  Their 5 for C-N-Y campaign is trying to get five percent of people’s estates left to organizations within this community.  ANd you want to hear the astounding impact that can have?  Remember that amount from before…20 billion dollrs of wealth being transferred over the next decade or so?  Well 5 percent of that is about one billion dollars that Dunn says could be game changing ?  

“If that billion dollars was endowed, spending 5% of the asset value each year, that would be $50 million a year.  For comparison purposes, if you were to add up all the foundation assets in this region, currently it’s around $500 million.  So that would be twice the value of all our philanthropic foundations in this community.”  

A small percentage of people's estate value could have a big impact on just how thriving certain community and cultural resources are int eh community.
Credit cnycf.org

We heard about the Boys and Girls Club…Another example of where that money could go is “Say Yes to Education.”  What’s now a 30 million dollar endowment for Say Yes, Dunn says, is immensely valuable.

“We don’t have annual-itis , where every year you have to find the money again.  For $30 million we have permanently paid for college education for thousands of kids -- for generations.”

Or how about a more thriving arts scene…Dunn says most local cultural institutions don’t have much in the way of endowments, which could be developed with more assets.   He adds the same impact might be seen in poverty, animal welfare and other areas. 

You might be thinking ‘that money we’re trying to spend on the community really belongs to the children or other heirs’ – well, you’re right.  And estate attorney Ann Ruffer says, mix money and family?  Well…?

“Now I have seen families conflict on the transfer of wealth.  Particularly it seems when the second parent passes away, there can be issues with the siblings so you just hope there is a good plan in place, that the documents are all in order.  If there’s going to be conflict it will be there.  It’s deep-seated.” 

But it doesn’t have to be.  Certainly advanced planning … and advanced warning can help.  Remember Linda Hartsock?  …she had the same worry when she told her children that some of their inheritance was being pledged for community causes…but she got a surprise.

“They were absolutely overjoyed…because let’s be honest, this isn’t my money; this is their money.  Particularly the Boomer generation, because we grew up with depression-era parents, who did everything for us, and we have this sense that we really want to provide for our children.  But I said to them, ‘you know, this isn’t my money; this is your money.”

Of course, She reminded them only five percent was pledged for a fund – in fact, one son wondered why not more?   That certainly went better than many might expect…and Hartsock understands why it  hasn’t come up in many families.

“I think everybody’s naturally anxious thinking about that last chapter of their life and what their legacy is and what that means.  People who don’t necessarily think of themselves as high-net-worth individuals, to think about how collectively those kind of gifts can make a huge, huge, huge community impact.”  

Who’s probably thinking community when considering how to bequeath their assets?  Well, Peter Dunn finds folks who don’t have children are most likely to leave money to community organizations directly or through a foundation. 

Full disclosure, WAER does get support from the Central New York Community Foundation at times…including their Five-for-C-N-Y program.  But everyone we spoke with for this story is concerned that in financial planning people might not think of the local charities and causes important to them.  And virtually every charitable, educational, religious, cultural, environmental and service organization can appreciate how much it might help.