Mikestrathdee’s Blog


Preventing Prodigals
February 24, 2017, 10:15 pm
Filed under: Estate Planning, Generosity, stewardship, Theology, Uncategorized

 

By Mike Strathdee

(Published in January 2017 issue of Canadian Mennonite and the Jan/Feb issue of The Recorder magazine.)

Many of us are familiar with the the Parable of the Prodigal Son in Luke 15. There are great lessons in this story about grace and forgiveness, but I’ve never heard it used in the context of warning about giving children gifts before they are emotionally or spiritually mature enough to handle them properly.

We aren’t told how old the prodigal was when he made his disrespectful, audacious demand of his father, but clearly he wasn’t ready to handle money responsibly. When I heard that passage read some time ago, I couldn’t help wondering if the story could have been different if the father knew what we now know about human brain development. What was the father thinking? Could he have had any idea how poorly equipped his son was to handle the premature inheritance?

Science has taught us that even in well-adjusted people, it can take up to age 25 before the prefrontal cortex is fully developed. That’s important because this part of the brain helps people appreciate the consequences of their actions. In her book Payback: Debt and the Shadow Side of Wealth, Margaret Atwood argues that, knowing what we now understand about brain development, giving people access to credit cards too soon could be considered a form of child abuse.

Similarly, parents should consider whether allowing their children to potentially inherit more money than they’ve ever had before, as soon as they attain the age of majority, would be a blessing or a bane.

About 15 years ago, I was trying to make this point in an end-of-life planning seminar at a church in a small town. I was shocked to see a young woman stand up in her pew and say that she agreed with me completely.

Later, I heard the sad family story. Her father died when she and her brother were 19. Their mother had passed away earlier. They each inherited $60,000. It was way more money than either of them knew what to do with. Her brother chose particularly poorly, burning through all the cash and ringing up considerable debt in only 18 months. She is now determined to ensure that her children have a better understanding of money.

Another verse relevant to the topic of inheritances is Proverbs 13:22: “A good person leaves an inheritance for their children’s children, but a sinner’s wealth is stored up for the righteous.”

At first glance, this passage may seem to focus on skipping a generation and leaving everything to the grandkids. But when taken in context with other advice in Proverbs, we see that wealth can only be successfully transferred between generations if a values transfer comes ahead of the money.

Part of me wonders if we might have fewer prodigal sons and daughters, and fewer prodigal grandsons and granddaughters for that matter, if we were more explicit in modelling generosity and explaining our beliefs and habits. We can transfer good values to our children by educating them about responsible spending, good habits and about giving throughout our lives. We can also model generosity in our estate plans by including charitable gifts as if they were an extra child in the list of beneficiaries. Let your kids know what values are important to you and how you hope they will continue them with their inheritance.

Abundance Canada can help you design and carry out a generosity plan. Ask us how.

Mike Strathdee is a gift planning consultant at Abundance Canada serving generous people in Ontario and the eastern provinces. For more information on impulsive generosity, stewardship education, and estate and charitable gift planning, contact your nearest Abundance Canada office or visit abundance.ca.

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Look to the U.S. for the next big catalyst for charitable giving

A couple of decades ago, some of the largest Canadian charities were suffering. Federal cuts to transfer payments, seen as necessary to balance the national government books, were a body blow to universities, hospitals and others.

Help for the charitable sector came in the form of a policy change in line with what donors enjoy in the U.S.  After considerable lobbying, Ottawa agreed to “temporarily” reduce in 1997, then permanently eliminate in 2006, the capital gains tax on appreciated securities when donors gifted them in kind to charity.

By some estimates, that single change resulted in charities receiving an extra $1 billion in donations almost every year since 2006.

With the Canadian donor pool aging and reportedly shrinking, maybe it is time for the sector to look to the U.S. once again for a big idea to kick start the next wave of giving.

In December 2015, Congress passed a bill making permanent a charitable gifting option that allows donors aged 70.5 and older to withdraw IRA funds – a tax-deferred retirement account analogous to our Canadian RRSPs –  to donate to their favorite charities. Withdrawals of up to $100,000 each year can be made without these distributions registering as taxable income.

Given the billions of dollars of RRIF (Registered Retirement Income Fund) income that Canadian baby boomers have to begin drawing down as they turn 72, there are massive possibilities here. Not only do some people not need all of the income they are forced to begin drawing, many are not looking forward to the accompanying tax hit.

A significant number of Canadians will move into the top tax bracket when they draw their last breaths, if that occurs before they have depleted their RRIFs.  In Ontario, that top bracket current stands at 53.5%. Charitable tax credits have been adjusted to match.

Getting a cash-strapped federal government to consider a break for retirement funds donated to charity will not come easily. Many leaders in the charitable sector will say their top lobbying priority will be convincing Ottawa to reinstate the proposed capital gains exemption for gifts of real estate and private shares that was accepted, but not enacted, by the former Harper government.

(Donald K. Johnson, who led the successful lobby for favorable treatment of donated securities some years back, is also pushing Ottawa to give exemptions for real estate and private share gifts. A Toronto Star story says such a change would result in additional donations to charities of about $200 million a year. The cost to the federal treasury would be between $50 million and $65 million.)

But it’s also time to start asking whether the lowest-hanging fruit for growing charitable donations could lie with the ever-increasing wave of RRSP savings that need to be converted to RRIFS and withdrawn.

Lots of good causes sure could use the help.



On autonomy and community
March 1, 2016, 9:29 pm
Filed under: Communication, Financial Management, Generosity, stewardship, Theology

Published Feb. 24, 2016 in Canadian Mennonite magazine

Feb 24, 2016 | Volume 20 Issue 5

“So Jacob was left alone, and a man wrestled with him till daybreak. When the man saw that he could not overpower him, he touched the socket of Jacob’s hip so that his hip was wrenched as he wrestled with the man. . . . The sun rose above him as he passed Peniel, and he was limping because of his hip” (Genesis 32:24-25, 31).

Dutch pastor Wieteke van der Molen used this text for a Friday evening message at the Mennonite World Conference assembly in Harrisburg, Pa., last July. Out of many good sermons that week, her message, “On autonomy and community,” struck the deepest chord for me. (The entire message is available online at pa2015.mwc-cmm.org.

We are all part of a community, van der Molen noted, be it a family, tribe, school, workplace or church. Some of us are members of multiple communities. Community feeds us, nurtures us and teaches us right from wrong, she said. To be human is to be part of community; we cannot survive alone.

We also crave autonomy, to have control over what concerns us. We want to make our own decisions, to be and do our best. There is a major tension between these important truths.

The struggle was ever thus, even in Old Testament times. As we read in Genesis, Jacob believed that he came first, always. He swindled his brother, deceived his father and so on. But living by your own set of rules and living in community do not go well together. After wrestling with the angel, Jacob struggled with the people around him, with God and with himself.

Autonomy, van der Molen argues, means that you are your own judge, but you have to figure it all out by yourself. Jacob’s story teaches us that it is not wrong to seek our own way, but we need to recognize the community around us, acknowledging the pain, hurt and frustration on both sides.

Modern, grown-up autonomy doesn’t come easy. When we act like Jacob did, wrestling with God, community and self, van der Molen has this warning: “Even if you win, it leaves you slightly limping.” How much of that limping results from failing to seek counsel?

One of the core principles that Mennonite Foundation of Canada (MFC) teaches is that God asks for our whole selves; that stewardship is best forged in Christian community marked by integrity, accountability and joy. Do we seek out Christian community and accountability in our walk as stewards of all that God has entrusted to us? Where do we find counsel in making choices around financial matters and in determining whether those choices are God-honouring?

In the 16 years that I have shared the MFC message of generous living and faithful, joyful giving, I have noticed the desire for autonomy, at whatever cost, intensify. Interest in, or even understanding of, community and the responsibilities that come with community, has crashed to a similar extent. It affects many of the institutions that we serve. Denominations, churches and some charities are limping, staggering in some cases. Others are thriving and growing, but there will be more limping and brokenness in coming years, I suspect.

We can do a lot more together than we can apart. How do we foster discussions around the value of community in our financial decisions? MFC can help. Perhaps a money autobiography class would be helpful. Maybe a discussion of best practices, both on a personal and congregational level, could be of assistance. Ask the MFC office closest to you for resources to help get the discussion started.

Mike Strathdee is a stewardship consultant at Mennonite Foundation of Canada serving generous people in Ontario and the eastern provinces. For more information on impulsive generosity, stewardship education, and estate and charitable gift planning, contact your nearest MFC office or visit MennoFoundation.ca.



Why should I give to your church?

Published in Canadian Mennonite, March 2015

Helping people give money away over the past 15 years has been a tremendously rewarding part of my work at Mennonite Foundation of Canada.

Many of these generous people are from the “builder generation” (born in or before 1945). The builders I’ve spoken with give generously, value church institutions and trust the people who run them.

Being told there is a need opens their wallets or cheque books. As these people age, become infirm and pass away, I miss their generous spirits. Increasingly, many churches, church agencies and related institutions are starting to feel the same sense of loss. That loss will intensify from dull ache to stabbing pain in coming years for those who don’t overhaul their approach and communication with donors.

Many in my generation and most in younger cohorts don’t see things the same way as their church-attending parents and grandparents did. This is true even of the much smaller fraction of boomers and millennials who still attend church more frequently than Christmas and Easter.

Given this clear dichotomy in how different generations respond, it is sad to see people making appeals based on guilt and obligation near the end of a church’s financial year. That doesn’t work anymore. It reminds me of the father recounting to his young daughter how his family had purchased their first colour TV when he was 10 years old. After some reflection, the daughter replied: “Daddy, was the whole world black and white then?”

Leave it to Beaver-era appeals don’t work in the digital age. Loyalty to church institutions is a foreign concept to a sizeable group of church attenders. Without new, compelling and repeated calls to commitment, the idea of supporting a congregation’s ministry is easily overlooked or dismissed.

J. Clif Christopher, in his book Rich Church, Poor Church, says he finds “far too many church leaders who are working on the answer to the question, ‘Why should I give?’ and not on the right question for today, which is, ‘Why should I give to you?’”

Younger donors who are asking the latter question don’t want to hear about commitments made at a budget meeting they didn’t attend. They want to give to vision, to relationships. They want to hear about outcomes and changed lives.

As the number of charities competing for donor attention continues to multiply—and Sunday morning once in a while is the extent of many people’s exposure to church—a congregation that wants to succeed in growing givers’ hearts needs to have a compelling answer to Christopher’s question: “Is my church the best place for me to invest to make a difference and change lives?”

Getting positive responses to that question will require leaders willing to move beyond traditional approaches. As Christopher says, “Being taught to give is as integral to the mature Christian life as learning how to read is to the adult life.”

Do we care enough about church to use proven stewardship best practices, even if they make us uncomfortable?



If I had a million dollars

Published in the June 24, 2013 issue of Canadian Mennonite magazine

Many of us dream about how we might spend a large, unexpected windfall. Some imagine travelling to exotic locales, or owning a new vehicle or dream home. Some dream about making a difference.

I would use my imaginary windfall to invest in our pastoral leaders and the future health of the church by funding financial literacy programs at Bible colleges and seminaries.

Debt is a huge issue confronting our society. The average Canadian owes $1.65 for every dollar of after-tax income earned. It would take over half a year’s salary for the average Canadian to repay his/her consumer non-mortgage debt.

How much training do church leaders get at seminaries and Bible colleges so they can help people learn how to live within their means? Basically nothing. When I asked about this at a Mennonite ministerial gathering this winter, some nodded and murmured assent. No one disagreed.

Not only do seminarians graduate ill-equipped to help members of their congregation in this area, increasing numbers are graduating with crippling debt loads that impair their own ability to be effective, and may even force them out of ministry. This situation also reduces the pool of candidates who are able to serve at smaller congregations. (A shortage of pastors willing or able to serve small and rural churches is an increasingly major concern across Canada, according to a recent study by the Evangelical Fellowship of Canada.)

Some seminary graduates have student debt loads approaching or even exceeding $100,000. Graduates head into ministry and are offered part-time positions, sometimes with few benefits. Many times their first churches are in small or rural communities where there are limited opportunities to earn additional income unless they are handy with a hammer or a computer.

It’s hard enough for pastors to talk about money, let alone lead by example, without the pressure of unresolved personal challenges in that area. Fortunately, some organizations are recognizing the problem and taking steps to address it.

Luther Seminary in Minnesota has a financial coaching program through its Center for Stewardship Leaders. Any student who applies for financial assistance at Luther is paired with a trained volunteer coach. Coaches are transparent about their own choices and situation, and provide a safe environment to guide students through their challenges over at least one academic year. “The job of financial coaching is to help you get your financial life in order, clear the way to a sense of well-being about money and free you to be a stewardship leader,” the coaching manual states.

After developing the coaching manual and recruiting mentors, the seminary spends only a few thousand dollars a year on the program, director Charles Lane tells me.

The United Methodist Church in Indiana takes a more holistic approach. Matching grants from the Lilly Endowment provide educational programs for clergy and lay leaders, plus grants to clergy or clergy spouses.

If I had a million dollars, I’d fund Bible colleges and seminaries to offer financial literacy programs. Tuition and materials would be free for anyone who commits to full attendance and participation. On successful completion, a graduate would get the added bonus of a grant that could be applied against student debt.

We ask a lot of our pastors. Giving them the training they need in financial matters would be a great gift for them, their congregations and the wider church.



Garlic, and remembering Dad
August 20, 2014, 3:17 pm
Filed under: gardening, Generosity, Tributes | Tags: , , , , ,

This summer’s garlic harvest was bittersweet, for several reasons. I picked a poor spot

to plant it in last November, too dry due to a nearby maple tree.

That error yielded a series of undersized bulbs in August. And for the first time, I can’t compare

harvests with the man who passed on his love of allium sativa to me.

Dad died last September, weeks after digging up his final haul of large, fragrant bulbs. There

were 500 bulbs, give or take, enough for a small village, more than ample to supply many family,

friends and neighbors plus his daily intake. It was an extravagant supply, in keeping with the massive

harvests of potatoes, carrots and in his final years, kale that he planted in an oversized small town

garden larger than many city lots. Had he been so inclined, Dad could have run a stand at the local

farmer’s market with his surplus produce.

As a gift to people who came to his funeral, my brother Al, sister-in-law Gloria and other members of

their family prepared 300 bulbs, each prettied up with a length of ribbon that had attached a small card

with Dad’s picture and the phrase “a gift from Grandpa Jim’s garden” on one side. Instructions for late

fall planting were written on the other side of the card.

Some people said they would use it for lasagna that night, others said they would follow the

instructions and do their first ever planting late in the fall, thanks to “The Garlic Man.”

Appropriately, the variety Dad favored was an Ontario breed named “Music,” completely suitable for

a man whose other great love was picking and grinning.

Like Dad’s over-sized love for his garden, raising rabbits and making music, Music garlic at its best

is elephantine in scale, with little resemblance to the shriveled foreign garlic that many make do

with from grocery stores for much of the year. When planted around rose bushes, it proves most

effective in keeping bugs away. The taste cannot be equaled either.

Native to Asia and cultivated for over 6,000 years, garlic is commonly eaten around the world. While

there are 70 different strains of garlic in the estimated 2500 acres that commercially planted in Ontario,

Music is said to make up about 90 per cent of the total. But price conscious Canadians import over two

thirds of their garlic from China. Dad had little use for store bought Asian garlic, saying it was of little

value on the rare occasions he was forced to substitute.

Dad made a point of downing at least a large clove a day, often raw, sometimes in his breakfast juice,

first thing in the morning, much to the chagrin of some health care professionals who literally couldn’t

stomach the smell. My guess is that most years he consumed three or four times as much as the

2.3 pounds reportedly eaten annually by the average North American.

Many a full head of garlic made its way into clay bakers at our house, oven roasted and later spread on

fresh-baked bread for a delectable dinner treat thanks to Dad’s never-ending supplies. It is important to

exercise caution when indulging in this treat however. We once had dinner guests who were newcomers

to Canada and unfamiliar with garlic’s charms. The two heads we had baked as a side dish for the meal

sat largely untouched until a family member decided to go for it and consume the lot.

Reminders of that meal oozed through the diner’s pores for several days, an aroma that is not to

everyone’s liking.

Trying to locate Dad near his garden on weekends between mid-April and October was generally a

futile exercise. Most often, he had loaded up his trailer, grabbed his beloved Martin guitar and headed

off across southern Ontario with his girlfriend Joan to a steam show, fiddle competition or some other

rural gathering of the country music and bluegrass “gypsies” that were his tribe. Like him, most were

retired folk who loved nothing better than a weekend camping, playing, singing and telling stories,

some of which were possibly even true. He died on a Friday evening at one of these gatherings,

succumbing to a heart attack shortly after singing a few numbers in a friend’s barn and

wandering off to his trailer with promises to see everyone later.

Fitting then, that acoustic music played a large part in his funeral celebration. A trio of fiddlers,

including a granddaughter, cranked out “Maple Sugar”, “Devil’s Dream” and other jigs and reels while

over three hundred mourners took their seats in the St. Marys United Church for the service.

Five of his grandchildren sang or played during the tribute, and a long-time musical friend from

Hanover played some Hank Williams hurting music as the family followed the casket out of the church

an hour or so later. At the rural cemetery outside the hamlet of Avonbank, where his parents had been

laid to rest over 50 years earlier, the musicians started up again once the pastor had finished the

committal service. Strains of “Til We Meet Again”, then “Heart of Gold” rang through the countryside.

When I returned to Avonbank months later to view the gravestone, someone had left a bulb of Music

garlic beside Dad’s grave.

Maybe I should sing some old country songs while planting this fall’s garlic crop, to get it right.



On the topic of impact – are you a fire hose or drip irrigation donor?
June 26, 2014, 2:25 pm
Filed under: Charitable Giving, Estate Planning, Financial Management, Generosity

Published in the June, 2014 issue of Gift Planning in Canada
On the topic of impact
Mike Strathdee
Helping donors understand the impact of how they support their favorite causes can take some explaining.
The people I have the privilege of working with generally
make giving decisions informed
by their faith. Unlike churchgoers
of earlier generations, the place where
they worship is often not the primary
or sole beneficiary of their giving.
In fact, it is common for me to meet
with folks who receive charitable
receipts from 20, 30 or more different
charities every year.
Without a doubt, deciding whether
to make large gifts to a few causes
or smaller donations to a greater array
of charities is a highly personal
decision. Getting people to recognize
that one-time gifts under $100
are costly for charities is sometimes
the first discussion point.
Once donors have narrowed down
who will be on their list, asking whether
they want their end-of-life gift to have
short, or longer-term impact can result
in blank stares. I am often asked,
“Isn’t it all the same?”
Water metaphors can be a useful
way of helping donors see the value
of different approaches. The metaphor
I have found most helpful is fire hose
versus drip irrigation.
A fire hose provides quick, intense
bursts of water – great for extinguishing
a blaze, with as much pressure as
possible, or responding to a large,
immediate need. If a person wants
to grow flowers or vegetables, however,
the amount of water that comes out
of a fire hose quickly may be
overwhelming. When growing fragile
crops, drip irrigation, with smaller
amounts of water released over a longer
period of time, is more helpful.
The fire hose approach to end-of-life
giving may be unhelpful, particularly if
the gift is to a smaller charity (or
a larger one that doesn’t have good
policies on how bequests will be used).
I once met with a couple who wanted
to leave a $180,000 gift to their church
– a small rural congregation – that had
no bequest policy. When they told me
that the church’s annual budget was
only $150,000, we were able to have a
good conversation about whether this
gift would be helpful or harmful.
They eventually decided to have the
gift to their church flow through the
Mennonite Foundation of Canada over
a 10-year period.
Sometimes, for donors with
significant charitable intent, there
is often an opportunity to combine fire
hose and drip irrigation gifts. There
are a number of reasons that people
will choose to support an endowed,
or drip irrigation approach to giving,
including ensuring that their support
will continue after they are gone
– incorporating both legacy and
sustainability elements. For example,
In a recent meeting with a couple that
had spent a fair bit of their career
working in the charitable sector,
I was happy to hear that they wanted
to give gifts to organizations that had
endowments. They knew that many
donors dislike supporting the
important work that goes on behind
the scenes, unnoticed or appreciated
and so decided to give support to the
administration of charitable work.
Other donors want to create (or
support) new possibilities for mission,
if a charity’s use of its long-term fund
is broad enough. Contributing to a
medium or longer-term fund to support
the cause(s) they care about fits well
with the giving wishes of more donors
than you might think. But they may
need to ponder different sorts of water
pressure to understand why.
Mike Strathdee, MA, CFP is a Stewardship
Consultant with Mennonite Foundation
of Canada, a national, faith-based public
charitable foundation. Based in Kitchener,
Mike works with individuals, families and
congregations throughout Eastern Canada
in the areas of charitable gift and estate
planning and financial literacy. Prior to
joining MFC in 1999, Mike had a 15 year
journalism career, including 13 years as a
business writer at the Kitchener-Waterloo
Record newspaper.