by Bruce DeBoskey, The DeBoskey Group

Many donors look at their charitable efforts and wonder: Does the nonprofit I’m supporting really have an impact? What can I do to make my philanthropy more effective? How do I involve my kids in our charitable efforts? How can I pass more than money on to the rising generations?

Donors who wish to truly maximize the impact of their giving must develop a strategic rather than a random approach to philanthropy. Becoming an effective philanthropist (rather than merely a generous donor) means planning to optimize the efficacy of giving. Many of the same intellectual resources and rigor that were used to earn money in the first place should be applied to philanthropic efforts to distribute that money. Research, analysis, strategy, organized implementation, evaluation and adjustment are critical investment tools which, when also applied to philanthropy, can achieve better results.

As with any important decision — investment, business or personal — a thoughtful longer-term strategy enables you to determine what you want to achieve and how to do so effectively.

Being an effective philanthropist doesn’t depend on the amount of time or money you give, but rather upon how you approach your giving. Here are some key steps to help you answer the questions above – and more – and help make your philanthropy transformational, not just transactional.

1. Meaningfully engage your family and determine your reasons for giving.

People engage in philanthropy for many valid reasons — including gratitude, theology, altruism, recognition, influence, tradition, tax planning, legacy creation, passing values to the next generation, social pressures, compassion and guilt. Engaging family members across the generations in meaningful discussions about what motivates your giving is an essential first step to developing a strategic giving plan. By working together around shared values, families can become stronger and healthier. By creating a “safe zone” around the activity of giving, families can reset the rules of engagement and encourage the participation of rising generations as equal partners in decision-making with their elders.

2. Identify desired outcomes and focus on impact.

Philanthropy seeks either to preserve something of value to the donor (e.g., forests, symphonies, libraries, democracy or community) or to improve something that needs to be changed (e.g., reading, equality, environmental degradation, health, education or opportunity), or both. A narrow focus on a limited number of causes enables donors to have a greater impact, derive more meaning and satisfaction, and become more personally involved in the desired outcomes.

Reject the “peanut butter” approach to giving – spreading your donations thinly over a wide area. “Go deep, not wide” is a mantra of strategic philanthropy.

3. Seek “best in class” nonprofit partners.

With more than 1.5 million nonprofit organizations in the United States, it is difficult to determine which are truly effective at designing and implementing programs that actually achieve their missions. Before donating to a nonprofit, research its effectiveness, financial sustainability, professional and volunteer leadership, responsiveness to shifting needs, engagement of beneficiaries and other stakeholders, the theory of change deployed, and the difference actually made (rather than just the activities undertaken.) Make sure you understand the true impact of the organization you are supporting. Ask not only “What do you do?” Also ask, “What impact are you having?”

4. Determine whether philanthropically committed capital is aligned with your mission.

In the U.S., more than $800 billion currently resides in foundations and donor advised funds. That money is philanthropically committed to mission, has received a generous tax deduction and cannot be returned to the donor. Each year, just 5 to 20 percent of those funds are distributed to nonprofits. The remaining capital is invested in public and private markets, usually for the sole purpose of financial growth.

The goals of these investments may not match your philanthropic objectives. Discuss with your wealth advisor whether the investments in your charitable vehicle further your charitable mission and how you may be able to utilize all or some of this philanthropic capital to advance your charitable goals.

5. Evaluate and make changes as you go.

Philanthropy that makes a real difference over time is difficult to do well. It takes more than a spate of year-end check writing. Many people donate to the same charities year after year without learning whether any real progress has been made towards achieving their desired outcomes and whether a change in strategy might be more effective.

Effective philanthropy requires persistence and a willingness to examine not only successes, but also failures. Changing circumstances and unanticipated events or participants all require a philanthropist to continually learn and adjust their strategy — even while it is being implemented.

6. Give boldly, start now!

During life, we all want to conserve enough resources to take care of ourselves and our loved ones. However, many of us can easily achieve that goal and still engage in some sort of philanthropy. A financial advisor can help people predict what they’ll need to live securely and provide for their heirs. Using at least some of the remainder to give during one’s lifetime provides learning, growth and fulfillment — none of which, as far as we know, can be enjoyed from the grave. Moreover, your community, nation and world need you today.

For many people, philanthropy runs on the fumes of their lives, rather than being part of the engine. In my years of helping families in this field, I’ve learned that philanthropy is like love. The more you make it a cornerstone of your life, the more you’ll find the joy, meaning and satisfaction in living.

Bruce DeBoskey, J.D., is a philanthropic strategist working across the U.S. with The DeBoskey Group to help families, businesses and foundations design and implement thoughtful philanthropic strategies and actionable plans. He is a nationally syndicated newspaper columnist of “On Philanthropy” and a frequent keynote speaker at conferences and workshops on charitable giving. The DeBoskey Group. is part of AEF’s Philanthropic Advisory Firm Referral Program.