Philanthropist Melinda French Gates recently made headlines when she announced she was formally stepping down from the Bill and Melinda Gates Foundation. Notably, it was reported by NBC News that she will retain “$12.5 billion that she plans to put toward her ongoing work supporting women and families.”
With (perhaps) a clearer path ahead and a resolve to be hyper-focused on her core areas of support, Gates’ announcement provides strong lessons for current and future philanthropists about the importance of having a plan, being willing to pivot and always aligning your vision with your funding abilities.
Her success affirms that with a plan, a focus area and the knowledge of which partnerships to pursue (or leave), both current and future philanthropists can greatly improve their impact.
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
Lesson #1: Always have a plan.
A philanthropic fund can be utilized most effectively when there is an alignment with values, passions and interests. Philanthropic planning allows individuals and organizations to make a thoughtful and strategic approach to charitable giving and to help maximize their donations' impact.
This includes developing an investment policy statement, asset allocation and portfolio construction, fiduciary compliance and oversight, risk management, family legacy planning and customized reporting and analysis for your investment committees.
Starting with a well-thought-out plan helps to ensure that resources are directed toward causes that resonate deeply with you, increasing the potential for meaningful impact. Having this plan in place helps you stay on target for your charitable giving goals now and in the future.
Indeed, as a leader who has centered her work on improving the lives of women and children, Gates has been steadfast in her commitment to supporting the next generation of female leaders. As she began to identify the severe lack of funding for women founders, she launched Pivotal Ventures to invest in early-stage companies led by women.
Lesson #2: Autonomy can be a superpower.
Sometimes, partnerships that start off on the strongest footing will no longer serve you. In the Gates Foundation example, this could be the dissolution of marriage between two founders, or more commonly, breaking ties with a trusted adviser. Indeed, the Gates Foundation made an incredible impact in its decades of existence, but the divorce of its founders certainly shifted the relationship and communication style.
Philanthropists must be flexible and willing to pivot when necessary to ensure their contributions have the greatest impact. According to Philanthropy Miami, “Flexibility goes beyond mere survival — it enables nonprofits to thrive in times of change. By embracing a mindset of flexible leadership, nonprofit leaders can foster a culture of resilience and innovation within their organizations.”
While seeking professional advice and collaborating is essential, philanthropists should not be afraid to go it alone if the original plans or partners aren’t aligned with their goals. This autonomy can empower philanthropists to pursue their vision more effectively and innovatively, attracting new partners as their goals and values evolve.
Lesson #3: Double down to effect the greatest change.
Over the past 20 years, the Gates Foundation has donated $53.8 billion to fight poverty, disease and inequity worldwide. While they have certainly made tremendous strides in those areas, these issues have not yet been eradicated.
Philanthropy is an ongoing endeavor with vast, seemingly endless, amounts of money needed to tackle some of society's biggest challenges. One thing is clear: While easy, micro philanthropy (small sums donated at cash registers or round-up opportunities) will not move the needle.
To effect change, philanthropists must do the deep work to figure out what they love and where they want to help. Open Philanthropy suggests considering the following three factors when evaluating an area to fund:
Importance. How important is this focus area, and how many people are affected?
Neglectedness. How neglected is this focus area?
Tractability. Are there clear ways a funder could contribute and make significant progress?
Gates’ commitment to supporting women and families reflects a concentrated effort to address specific issues that are important to her. By doubling down on these core areas of interest, she exemplifies how focusing on fewer areas can create a more significant and lasting impact compared to spreading resources too thin across numerous smaller initiatives.
It’s clear that in her next chapter, Gates’ impact and influence will continue to grow. By following her model, current and future philanthropists also have a great opportunity to mold a better world in their vision.
ALINE Wealth is a group of investment professionals registered with Hightower Securities, LLC, member FINRA and SIPC, and with Hightower Advisors, LLC, a registered investment advisor with the SEC. Securities are offered through Hightower Securities, LLC; advisory services are offered through Hightower Advisors, LLC.
Third-party links and references are provided solely to share social, cultural and educational information. Any reference in this post to any person, or organization, or activities, products, or services related to such person or organization, or any linkages from this post to the website of another party, do not constitute or imply the endorsement, recommendation, or favoring of ALINE Wealth or Hightower Advisors, LLC, or any of its affiliates, employees or contractors acting on their behalf. Hightower Advisors, LLC, do not guarantee the accuracy or safety of any linked site.
Related Content
- Apple TV+'s 'Loot' Offers Five Lessons for Inheriting Wealth
- Six Charitable Giving Strategies: Feel Good and Cut Your Taxes
- Philanthropy Needs Innovation to Help With Social Problems
- How to Maximize Your Impact With Strategic Philanthropy Tools
- How to Assess the Impact of Your Charitable Giving
-
I'm a Financial Planner: Here Are Five Smart Moves for DIY InvestorsYou'll go further as a DIY investor with a solid game plan. Here are five tips to help you put together a strategy you can rely on over the years to come.
-
Neglecting Car Maintenance Could Cost You More Than a Repair, Especially in the SummerWorn, underinflated tires and other degraded car parts can fail in extreme heat, causing accidents. If your employer is ignoring needed repairs on company cars, there's something employees can do.
-
'Drivers License': A Wealth Strategist Helps Gen Z Hit the RoadFrom student loan debt to a changing job market, this generation has some potholes to navigate. But with those challenges come opportunities.
-
Financial Pros Provide a Beginner's Guide to Building Wealth in 10 YearsBuilding wealth over 10 years requires understanding your current financial situation, budgeting effectively, eliminating high-interest debt and increasing both your income and financial literacy.
-
You're Divorced, But the Work Isn't Over: A Guide to Five Financial Tasks to Do ASAPOnce your divorce is settled, don't waste time. You've got to tie up some important loose ends or risk losing money and facing tax consequences.
-
Five Mistakes to Avoid in Your First Year of RetirementRetirement brings the freedom to choose how to spend your money and time. But choices made in the initial rush of excitement could create problems in the future.
-
I'm an Investing Expert: This Is How You Can Invest Like Warren BuffettBuffett just invested $15 billion in oil and gas, and you can leverage the same strategy in your IRA to potentially generate 8% to 12% quarterly cash flow while taking advantage of tax benefits that are unavailable in any other investment class.
-
Integrity, Generosity and Wealth: A Faith-Based Approach to BusinessEntrepreneurs who align their business and financial decisions with the biblical principles of integrity, generosity and helping others can realize impactful and fulfilling success.
