The Giving-While-Living Shift

A sense of urgency to solve global environmental and social issues is driving profound changes in how wealthy families are structuring their philanthropic plans. Traditional models, which aim to pay out charitable gifts for generations, are increasingly being replaced by plans that emphasise immediacy over perpetuity.

Three times the number of donors adopted giving-while-living timelines in the decade beginning in 2010, compared with the 1990s—38% of respondents versus 12%, according to a 2020 survey by Rockefeller Philanthropy Advisors in New York City. Of those, 76% chose to spend down philanthropic assets within 15 years, the survey found.

This trend is likely to continue, says Olga Tarasov, Munich-based director of knowledge development for Rockefeller Philanthropy. “There’s anecdotal evidence that the inequalities brought to the surface by the pandemic have accelerated this trend,” she says.

While the issues addressed by donors are the same regardless of time frame, environmental causes are particularly benefiting by the rising spend-down trend, Tarasov says. “When you look at reasons for giving, the environment is a higher priority for spend-down philanthropic plans.”

The giving-while-living trend is driven by a desire by donors to witness the impact of their gifts, says Dien Yuen, assistant professor of philanthropy at the American College of Financial Services. “The Gates Foundation started this and many have followed. They want to push money out the door now to see things in action.”

Tax planning is also a factor, especially during the longest bull market in history, when investors are sitting on enormous investment gains.

“There’s a big tax benefit to using securities to make gifts while alive,” says Andy Rosenberger, head of tax managed solutions at Orion Advisor Solutions in Omaha, Neb. “You don’t have to realize gains when you give them away and you create a charitable deduction that can offset income elsewhere.” When bequeathed at death, a charitable deduction isn’t permitted.

For folks who have a multigenerational charitable foundation but want to shift to a spend-down strategy within a shorter time frame, legal issues may have to be addressed.

“Charters of a foundation or family office often stipulate a timeline, and the default setting is in perpetuity,” says Tarasov. “But changing is difficult if a family is divided.”

Embracing Lifetime Giving

Most wealthy families aren’t committing to sunsetting all philanthropic assets by the end of their life expectancies, but are doing some of both—giving now and setting up foundations for giving over generations—says Caroline Hodkinson, head of philanthropic advisory at Bessemer Trust in New York. “There’s a spectrum, and most of our clients are in the middle.”

There is a notable difference in how clients approach giving during life versus at death, most notably, a stronger desire for both control over how gifted assets will be used and evidence of impact, says Crystal Thompkins, head of philanthropic solutions at BNY Mellon Wealth Management. “The lifetime mission involves a more dynamic conversation. Clients want to see diversity in leadership. Track records on success,” she says.

The Lifetime Giving Tool Kit

Lifetime donors must carefully weigh various charitable tools, Thompkins says. “It used to be that the uberwealthy focused on private foundations and donor-advised funds were considered only good for chequebook philanthropy,” she says. “But that’s shifting, because you can use donor-advised funds in really creative ways to meet lifetime planning goals.”

Charitable lead trusts are attractive when interest rates are low. Donors get a larger income tax deduction for the amount transferred to the trust when rates are low, Thompkins says.

The trust pays annual income to charity, and at the end of its term, remaining assets go to beneficiaries. They require in-depth planning because they have tax, estate-planning, and legal implications, Thompkins says. “That trust conversation has been deprioritized at a time where there is a sense of urgency around meeting need.”

Looking to build, or renovate, a home in 2024? You’re not alone. According to a recent study from Resolve Finance, over a third of Australian homeowners are planning to renovate their current properties in the next 12 months. And if the Federal Government achieves its ambitious goal of delivering 1.2 million new dwellings over the next five years, there will be many new home owners looking to build their dream home in 2024 and beyond.

But before tackling such a behemoth task, considering all the latest—and future—architectural trends is pivotal in your new build’s success. Award-winning architect and interior designer, Georgina Wilson said sustainability will be at the forefront for many interested in energy efficiency and saving money on power bills.

“Elements of passive design are moving into the mainstream. Improvements in the technology with double glazing, building wrapping and insulation are meaning that more people have access to these materials,” Ms Wilson said. “Solar has proven itself and homeowners are now looking for other ways to make their home more efficient.”

The following eight trends reflect a growing emphasis on sustainability, flexibility, and wellbeing in residential architecture, catering to the evolving needs and preferences of homeowners in 2024.

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1). Consider your colour palette

The colours you use say everything about the type of spaces you want to foster, whether they be bright and warm, dark and moody, neutral — the list goes on. If we’re looking to trends, earthy, calming neutrals are in — think brown, beige and eucalyptus green. Colours that feel natural and soft, but welcoming provide an inviting environment that’s easy to live with.

However, interior designer and stylist, Jono Fleming said contrast is important to create interest and one of the most powerful ways to do this is through colour.

“It doesn’t have to be a big splash of colour, it could be introduced through smaller decorative objects, a statement furniture piece or an artwork, but the colour should add balance to the space,” he said.

2). Modern, outdoor living areas

Ever since the COVID pandemic and subsequent lockdowns, expanding living spaces to the outdoors has gained in popularity. Features like plant-filled front porches, outdoor kitchens, fire pits, and cosy seating areas create inviting spaces for relaxation and entertainment for all family members.

“There has definitely been a greater appreciation for outdoor living spaces since COVID,” said Ms Wilson. “Outdoor fabrics and mechanisms for shading have greatly improved in recent years allowing people to fully embrace seamless indoor/outdoor living.”

3). The integration of smart technology

Integrating smart home technology throughout your home continues to gain traction with homeowners. As we increasingly look to rely on technology to make our lives all the more seamless, smart technology throughout allows homeowners to control a variety of tasks and zones remotely, enhancing convenience, security, and even energy efficiency. This can include controlled heating and cooling from your phone, automatic lightning, voice control commands, and more.

“The technology for seamless appliances has come a long way. At Salone del Mobile Milano this year, we experienced the new Gaggenau fully integrated induction bench top, which in terms of kitchen design, is a huge advancement,” said Ms Wilson.

Gaggenau, the German manufacturer of high-end home appliances, is at the forefront of smart home technology, paving the way for intelligent cooking appliances that learn and adapt to user preferences. Gaggenau’s essential induction cooktop, the functional and seamless cooking surface Ms Wilson speaks of (pictured below), is designed to be “seamlessly integrated into a kitchen’s worktop”.

4). Health and wellness features

Prioritising health and wellness in 2024 is paramount, and home design that can include features like air purification systems, dedicated exercise spaces, recovering hubs—like saunas and ice baths—and relaxation areas to support physical and mental wellbeing will go a long way in not only adding value to your home, but providing a space that is architecturally on-trend and with the times.

“I’m seeing a lot of demand for in-built saunas, both traditional and infrared, particularly in the homes of our US clients,” said Ms Wilson.

“Bathroom suppliers such as Kohler, Duravit and Toto are offering increasingly sophisticated products that incorporate an almost spa-like experience in your at home bathroom. Examples of this are fantastic multi-nozzle showers and steam showers, Japanese toilets incorporating bidet technology, and elegant and serene bathroom furniture that can be fully customised for clients.”

5). Sustainability is key

A common goal among homeowners and future buyers alike is to own a property that is flexible enough grow with them. Futureproofing your home with sustainable measures will not only ensure its longevity, but it will help homeowners to play their part in addressing their carbon footprint.

“The current cost of living crisis is leading to a lot more multigenerational living, meaning families are prioritising durable materials and sustainable power sources, like solar,” said Ms Wilson.

Consider adding solar panels to your home, utilising sustainable materials in any upcoming renovations or builds, like recycled timber, and utilising energy-efficient lighting throughout your home.

6). Minimalist design

Do as the Scandinavians do – introduce minimalist design into your home. Embrace simplicity and clean lines with a focus on interior design. Decluttering in main living spaces is surprisingly effective. Adopting the approach of ‘Swedish Death Cleaning’, which essentially involves slowly ridding your house of unwanted or unused items once you reach the other side of 50, will also help you whittle your possessions down to the beautiful and the necessary.

Minimalist design in home appliances is also making a resurgence in 2024 according to Ms Wilson.

“What I’ve been interested to see at Salone del Mobile Milano in 2024 is a huge return to stainless steel finishes, and more and more seamless integration of appliances,” said Ms Wilson.

“We’re seeing timeless materials in reimagined applications: copper baths and stainless steel basins are emerging trends with the potential to be timeless. These materials are so practical, and pair beautifully with natural stone and timbers.”

Above all, maximising different spaces through efficient and effective storage options will also do wonders in achieving that minimal aesthetic.

7). Multifunctional spaces

As we move towards greater efficiency of space, it’s useful to consider multifunctional spaces throughout your home. In 2024, we are seeing more homes incorporate multifunctional spaces and trends. This includes using multifunctional furniture in main bedrooms or living spaces—furniture that can act as storage ottomans or convertible sofa beds—as well as transforming wasted space, and open up indoor to outdoor living.

“Multifunctional spaces in homes are a great idea. Particularly in small homes, it makes a lot of sense to achieve maximum value out of the limited space available. The way you use a space can change as your family evolves over time, so it’s always good to design in such a way that allows for flexibility,” said Ms Wilson.

“Make sure that the functions you allocate to a single room are compatible with the space available and each other. For example, it works really well to combine a living room, a dining room and a kitchen in one open plan space because these are all public, lively spaces. It doesn’t work very well to combine, say a study, with these spaces because you will want control over the visual and acoustic privacy in a study.”

8). Think about biophilic design

A buzz word among architects and interior designers, biophilic design is one of the strongest trends in 2024 thanks to its benefits in garnering a sense of harmony and connection between your home and the environment. Consider incorporating natural elements into home design, such as large windows to maximise natural light, indoor gardens, and natural materials like wood and stone.

“Biophilic design is a timeless principle, in that home design should connect people in a positive way with their natural environment by maximising access to, and the ability to control, natural light and ventilation, which really helps to create an enjoyable (and healthier) environment to live in,” said Ms Wilson.

“Increasingly, there is a demand for this positive relationship to the natural environment; by leaning on the principles of biophilic design, you can create a haven and retreat at home that can help with the daily stresses of life.”

Ways to foster that indoor-outdoor connection can be through the addition of smaller internal courtyard spaces filled with greenery, or incorporating indoor plants and adding greenery into different rooms throughout your home.

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The Giving-While-Living Shift

Three times the number of donors adopted giving-while-living timelines in the last decade.

Futureproof your home and maximise your return with design directions that focus on contemporary ways of living