Future2, the charitable foundation of the Australian financial planning industry, is searching for new sources of contributions. Simon Mumme reports.

Most of the money raised by the financial planning industry’s charitable foundation, Future2, has so far been supplied by two companies. AMP gave $100,000 on the heels of the Financial Planning Association’s (FPA’s) annual conference in 2007, and Genesys Wealth Advisers put $65,000 towards the foundation’s appeal for survivors of the “Black Saturday” bushfires in Victoria in February.

Smaller sums have been raised during FPA conferences, the bushfire appeal and other fundraising activities – such as golf days and a recent AFL Grand Final lunch held by the FPA’s Melbourne chapter – but the bulk of the foundation’s capital has been supplied by the two big corporate donations.

Now Steve Helmich, head of AMP’s financial planning business and chair of Future2, wants to see the foundation benefit from a more sustainable source of inflows: workplace giving. Helmich says workplace giving is a suitable giving option in a time of slower economic growth, but is primarily another means “for us to get a solid base of funds to go to underprivileged young people through Future2”.

The FPA has become the first employer to provide staff with this mechanism for donating to the fledgling foundation. While most workplace giving donations are small and regular contributions, a financial planner recently demonstrated how the mechanism can be used to distribute larger sums. After nominating Future2 as the beneficiary of their workplace giving program, the planner sent $2500 to the foundation. Workplace giving is an attractive way of donating money because contributions are taken from salaries before they are taxed.

Making charitable donations from pre-tax income provides an automatic tax benefit for the donor, since their employer subtracts the donated amount from their salary before deducting tax. For example, assuming the employee is subject to a 30 per cent marginal tax rate plus Medicare levy, a $20 donation costs them about $13.50 after the automatic tax deduction. But Future2 still receives the full $20.

Helmich says workplace giving could build on the community work already carried out by advisers. Future2 is already heavily associated with the financial planning industry: the charitable arm is regarded as a hallmark of professionalism for the industry as it aims to raise its level of service to, and standing in, the community.

“Financial planning is very young in developing professional status, and [Future2] is about people seeing financial planning as it gets into the status of a profession,” an FPA spokesperson says.

“Chapters are getting increasingly involved in fundraising activities. They are also working with organisations to help them put forward grant applications.”

The US Financial Planning Association, for instance, runs the Foundation for Financial Planning, which puts people who are in need of financial guidance, but are neglected by the market, in touch with programs that can help solve their problems. Last year, the foundation topped US$10 million in assets, and distributed almost US$900,000 in grants.

A much younger foundation, Future2 is on the verge of announcing which community projects will receive a total of $30,000 in funding for its 2009 Make the Difference! grants program. The program aims to encourage advisers’ involvement in the community by giving preference to grant applications that involve, or are supported by, FPA members. To date, each grant distributed has gone to a project associated with an FPA chapter or member.

“At the moment, that is the situation, because there is a limited pool of funds,” Helmich says.

“The grant applications that come in [that are] associated with an FPA chapter or member are getting prominence.”

The foundation is in its second year of grantmaking activity. The annual distributions aim to “bring much-needed support to Australians battling with financial and social issues”, Helmich says.

And word of the program seems to be spreading among the FPA network. Last year, grant recipients included the London Murray Community Leadership Program, Nile Youth Group, the Young Sudanese Women’s Network, and the Youth Information and Referral Service. This year, Future2 reported an increase in the number of applicants to 21, of which three will receive about $10,000 each in funding. Each project operates within Future2’s focus area: young people, aged between 18 and 25, who are experiencing financial or social hardship.

The final day of the FPA conference in November will be titled “Future2 Day” – Helmich will speak about the foundation’s activities, in order to raise its profile, and will announce the new grant recipients. He will also outline how the bushfire appeal money donated by Genesys will be spent to benefit the communities recovering from the Black Saturday blaze.

“We’re working with Genesys and the local chapter in Victoria to make recommendations on the application of these funds,” Helmich says.

Join the discussion