Millions of social capital dollars are currently at stake in the Johnstown region. The question is how, not if, that money will be used and whom it will benefit.

When the Community Foundation for the Alleghenies held a kickoff for a marketing campaign in December, 78 invitations were sent to professionals in Johnstown – mostly lawyers and accountants – but fewer than 10 chose to attend.

The foundation’s mission is to promote sound estate planning to preserve social capital in the region. The invitation stated that activity created by this initiative may have a substantial impact on their businesses and the future of our community.

If these are serious issues involving professional careers and virtually millions of community dollars, then why such a tepid response? Lack of experience in planned giving and apathy are usually the biggest stumbling blocks.

Most professionals do not recognize that estate giving is a viable option to sound estate planning.

After all, who promotes planned giving? Charitable organizations and a few individuals from the financial service industry. Both are dismissed as having a vested interest. One group wants our money, and the other wants to sell us something.

Integrated planned-giving strategies are used so infrequently that they are not familiar to most advisers, including some of the nation’s most prominent estate planning lawyers. There is a significant disconnect between perception and reality.

Perception: Estate owners have advisers who are specialists in planning, and have their clients’ affairs in order.

Reality: Based on national studies, an amazing 45.7 percent of estate owners valued at $5 million and higher have no estate plans whatsoever, and an additional 27.5 percent have plans that are outdated. Experience tells us that almost none significantly address planned giving.

Perception: If planned giving was such a good idea, it would be promoted by my advisers.

Reality: A national study indicates that only 18 percent of planned gifts result from efforts of professional and financial advisers. Advisers question clients’ interests, as almost no one knocks on their doors to discuss planned giving – so why bother?

As a result, few professionals are fluent in the art of charitable estate planning, which often results in either passive indifference or even skepticism.

Social capital in estate planning is the money that can not be kept by the family at someone’s death. It is found in two forms – charitable gifts and taxes. Taxes are defined as government-controlled social capital, while philanthropy is defined as personally controlled social capital. Both forms are intended to contribute to the general welfare of the country, and nearly everyone participates – in one way or another.

Social capital at death transitions from personal to public money. When it unnecessarily leaves the community, it affects the future of all of our children and grandchildren, not just those of the estate owner.

The Community Foundation recognizes the enormous opportunity to preserve the region’s substantial social capital reserve.

The foundation’s goal is to make Johnstown the nation’s best-planned community.

Planned giving can be a very positive experience. It can define who we are as individuals and as a community.

It is a once-in-a-lifetime opportunity to teach children the importance of good stewardship and foster their responsibility for wealth.

So, the status quo must go.

We must inspire our wealth holders to be more diligent in their planning, and challenge the professional advisers to be more proactive.

The community is underplanned and underserved.

The foundation can provide the vision and leadership. It’s up to the citizens to transform that vision into reality.



Stephen Purich of Johnstown is a retired financial adviser and formerly owner of a wealth management firm.

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