Monday AM March 22nd, 2010

A survey shows that 75 percent of high-net-worth individuals will not be cutting back on their charitable spending, in spite of the economy. Ed Mayberry reports.

Investing Strategies for the High Net Worth Individual: Maximize Returns on Taxable PortfoliosWhile the rest of the world cuts back from the recession, a recent survey by Barclays Wealth and Ledbury Research shows that high-net-worth individuals in the United States and the UK remain committed to charitable giving.  Author Niall Gannon has written a book called Investing Strategies for the High Net Worth Individual: Maximize Returns on Taxable Portfolios.

"The attitude among the wealthy and even the not-so-wealthy has been strengthened through this global recession because I think a lot of donors realize that their donations are needed now more than ever.  And we've observed that that entrepreneurial spirit that built the wealth in the first place was probably there throughout their entire lives.  For those who are new to the concept of giving, though, we advise them to definitely look into their heart first.  There can be a risk of over-analyzing the tax impacts or the different models that can be used."

Gannon defines "high-net-worth" as those with average investable assets of $5.4 million.  There's no denying the tax benefits of giving, but Gannon says people have good intentions. 

"There definitely would be a decline in the amount of philanthropic gifts if the tax benefits of those gifts were to be diminished.  I think it's safe to say that the attitude towards philanthropy begins first at the heart, and secondly maybe at the wallet and at the tax return.  Because certainly the earthquake was not in anyone's expectations, and many families chose to fund all of their existing pledges — plus additional ones — for the earthquake."

There is some tailoring of investment strategies required that's different in times of boom or bust.  Gannon's book looks at portfolio diversification, after-tax returns of stocks versus bonds and managing risk in alternative investments, commodities and hedge funds.

Bio photo of Ed Mayberry

Ed Mayberry

Local Anchor, All Things Considered

Ed Mayberry has worked in radio since 1971, with many of those years spent on the rock 'n' roll disc jockey side of the business...