Transfer of Wealth StudyUnlocking the Potential

Publicly supported charity

Governed by a board of private citizens with

knowledge of the community

Administers individual funds that have been

contributed or bequeathed

Serves three publics:

◦ Donors

◦ Nonprofit sector

◦ Community as a whole

What is a Community Foundation?

How we help donors◦ Donor advised funds

◦ Designated funds

◦ Supporting organizations

◦ Named endowment funds (donors can make

them restricted or unrestricted)

Role of the San Antonio Area Foundation

Role of the San Antonio Area Foundation

How we help nonprofits◦ Agency funds

◦ Grants from donor advised funds

◦ Grants from endowed funds (competitive grant

process)

◦ Training and capacity building

Of the $10.9 million in grants distributed in 2011◦ 71% were from donor advised funds

◦ 19% were from endowed funds (competitive

grants)

◦ 10% were from scholarship funds

Role of the San Antonio Area Foundation

The Power of Endowment

When does

$2.9 million – $9.3 million

=

$5.1 million

How much wealth is expected to

transfer from one generation to

the next

When those transfers of wealth

are expected to occur

What is the Transfer of Wealth Study?

Largest under-developed financial resource

Timing is critical

Why a Transfer of Wealth Study is Important

Creates conservative scenarios (not predictions)

Establishes a base year and estimates current net worth (2010)

Uses inflation adjusted dollars

Discounts some assets (jewelry, cars, stamp collections, closely-held farms/family businesses)

Estimates timing of deaths based on demographic projections

How it is Done

Raise awareness about opportunities

Identify wealth in poor places

Create a call to action

Refine donor targeting and development

What a Transfer of Wealth Study Can Do

Give you personal information for specific

individuals

What a Transfer of Wealth Study Can’t Do

A Transfer of Wealth Studyis a

ToolThat can tell you where to look and what to look for

Wealth Indicators Housing in 2010

Wealth IndicatorsAge structure in 2010, percent of total

Wealth IndicatorsHousehold Wealth

Wealth IndicatorsEmployment & Business in 2010

Household Net Worth by Work Status

Source: Survey of Consumer Finances 2010

Homeowners without mortgages

People ages 64-74

Business owners

Where’s the Money

Period Bandera Bexar Comal Guadalupe Kendall Kerr San Antonio2011-2015 6.0% 7.3% 5.4% 5.7% 5.2% 9.7% 7.0%2016-2020 6.8% 7.7% 6.1% 6.3% 6.0% 9.7% 7.5%2021-2025 7.6% 8.2% 7.0% 7.1% 7.0% 9.6% 8.0%2026-2030 8.5% 8.9% 8.0% 8.0% 8.1% 9.8% 8.8%2031-2035 9.5% 9.5% 9.2% 9.0% 9.3% 9.9% 9.5%2036-2040 10.4% 10.1% 10.2% 10.1% 10.4% 10.1% 10.1%2041-2045 11.3% 10.8% 11.3% 11.2% 11.5% 10.1% 10.9%2046-2050 12.2% 11.5% 12.6% 12.5% 12.7% 10.2% 11.7%2051-2055 13.4% 12.5% 14.3% 14.2% 14.2% 10.4% 12.8%2056-2060 14.5% 13.4% 15.9% 15.8% 15.7% 10.4% 13.8%

Transfer of Wealth for San Antonio Area – When

Transfer of Wealth Opportunity

So, what can a Transfer of Wealth

Study do?

What if just 5% were given back

to the community through legacy

giving.

Opportunity Awareness

Transfer of Wealth for San Antonio – How Much

If just 5% of all estates were placed in an endowment over the next 50 years, an annual distribution of 5% would generate an additional $932 million in grants to the community.

That is like having 93 more Kronkosky Charitable Foundations or San Antonio Area Foundations to submit grants to.

What Does it Mean?

Even in the poorest communities,

there is opportunity for

philanthropy and giving back.

Wealth in Poor Places

San Antonio RegionSummary of Findings

Value PHH Value PHH Value PHHPlace Billions Thousands Billions Thousands Billions Thousands

Bandera $1.59 $198.6 $0.32 $40.2 $3.72 $464.4Bexar $88.54 $206.6 $21.97 $51.3 $257.87 $601.7Comal $10.74 $312.6 $2.45 $71.2 $39.67 $1,154.8Guadalupe $9.17 $243.0 $2.23 $59.2 $45.01 $1,193.0Kendall $5.13 $302.6 $0.87 $51.4 $14.59 $861.1Kerr $3.56 $225.5 $1.48 $93.9 $11.99 $758.7San Antonio $118.72 $219.3 $29.33 $54.2 $372.85 $688.7

2010 Current Net Worth 10-Year TOW 50-Year TOW

In rural communities, estates are

passed to children who have

moved away or didn’t grow up in

the area and have no interest in

investing in social or economic

development.

Call to Action

Research can be used to identify

new donor communities and their

philanthropic areas of interest.

Donor Targeting

Boomburbs – 4.2% Median age is 33.8 years

Mostly white

Median household income $110,681

Median net worth $387,651

Median home value is $282,689

ESRI Tapestry SegmentationBexar County

Boomburbs Buy household furnishings, toys and games,

men’s business and casual clothes, big-screen TVs, own or lease full-size SUVs.

Well-insured, holding life insurance policies of $500K or more.

Go online frequently to buy flowers and tickets to sports events, trade and track investments, do banking and make travel plans.

ESRI Tapestry SegmentationBexar County

Up and Coming Families – 8.9% Annual household growth rate of 4.56%

Median age of 31.9 years

Mostly white but diversity is increasing

Median household income $76,135

Median net worth is $175,142

Median home value is $175,637

ESRI Tapestry SegmentationBexar County

Up and Coming Families Family and home dictate products they buy

– baby equipment, children’s clothing, basic household furniture and lawn items.

Most likely own SUV or minivan. Eat out at family restaurants and buy fast

food and takeout. Play softball, take children to the zoo or Sea

World. Listen to country, soft rock or contemporary hit radio.

ESRI Tapestry SegmentationBexar County

Prosperous Empty Nesters Median age is 48.9 years but 6 in 10 are

age 55 or older

Approximately 90% white

Median household income is $67,295

Median net worth is $261,595

Median home value of $193,784

ESRI Tapestry SegmentationBexar County

ESRI Tapestry SegmentationBexar County

Prosperous Empty Nesters Value health and financial well-being Investments include annuities, certificates of

deposit > 6 months, mutual funds, money market funds, tax-exempt bonds and common stock.

Hold universal life insurance policies Exercise regularly and take multitude of

vitamins. Attend golf tournaments and sports events Likely to own or lease a luxury car.

Current net worth for

Bexar County is

$88.54 Billion

The Reality

$22 Billion is expected to

transfer between

generations over the next

10 years

The Opportunity

If just 5% were endowed for the

community and 5% distributed

each year, there would be an

additional $55 million in

grants for local nonprofits.

The Opportunity

$258 Billion is expected to

transfer between

generations over the next

50 years

The Opportunity

If just 5% were endowed for the

community and 5% distributed

each year, there would be an

additional $645 million in

grants for local nonprofits.

The Opportunity

With your Executive Director

With your Board

With your Donors

The Conversation

Create messaging about

5%

◦How much it is

◦What it can do

The Plan

Educate professionals

◦Attorneys (estate planning &

small business)

◦CPAs

◦Financial Planners

The Plan

Spread the word!

◦Workshops

◦Media campaigns

◦Giving Day 2013

The Plan

Cynthia R. Hamilton

chamilton@saafdn.org

San Antonio Area

Foundation

www.saafdn.org