First Friday Feedback: June 2025

Phil is joined by Myles McHale, President of Wealthcare Advisers and Consultants and Cannon Adjunct Faculty Member, to explore how midyear financial checkups can spark meaningful conversations about legacy, values, and charitable giving. From the importance of discovering a client’s “why” to the latest IRS updates on donor-advised funds and charitable trusts, this episode is packed with practical insights for advisors looking to elevate their client relationships and impact. Tune in to learn how to engage the next generation in family philanthropy and why now is the time to start planning.

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Please send Comments, Questions, and Feedback to: mojo@cannonfinancial.com

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Transcript

Hi, I am Phil Buchanan with Cannon Financial Institute. We produce the podcast series Monday Morning Mojo, the Cannon Curve, and Cannon Connect. Each of these podcasts invites listeners to email or text their feedback, comments and questions. They are all answered right here on First Friday feedback. If you're new to our podcast, go ahead and subscribe to all four and get engaged by sharing your perspective.

Life is about the journey. So let's go for the ride.

Hello, Cannon Nation. It is Phil here with First Friday feedback for June. 2025. Today I am joined by Cannon Adjunct Faculty Member Myles. McHale Myles is a, uh, former senior Executive Myles. You can give your, uh, credentials in just a couple of uh, minutes. But former senior executive of Wilmington Trust and uh, US Banks Wealth Management Group, today, you serve as president of Wealthcare Advisers and consultants, and again, are a, a fantastic adjunct faculty member for us here at Cannon. 

So welcome to First Friday feedback. Phil, it is tremendous to be with you today, and thanks for having me. Well, Myles, uh, give us a little bit more, uh, about the, the background that you bring to the table and, uh, where your specialty focus is today. Thank you. In CWS fashion at Cannon, the opportunity to credentialize your, your teammates as well as yourself is an important piece of the puzzle.

I've been lucky enough to start in the training program at the Morgan Bank in 1981, so a number of years back, 44 years back, and have really focused on two, uh, or three very important things, investment management. For, uh, wealthy individuals as well as institutions. Retirement really one of my passions, but my real passion, Phil and and company, are that.

Connecting with the individuals. Find out what charitable, uh, uh, organizations or institutions they wanna focus on and provide them the right solution set that is the right fit for them. You know, it's, it's interesting that you bring up the, uh, the, the philanthropic angle because, uh, it has literally been over the last.

Uh, six to eight weeks that I've had three different occasions, uh, to engage with planning groups around this issue of family philanthropic strategies. Now, there, there are lots of great firms out there that do a fantastic job, uh, in the, in the world of philanthropic planning, but in each of the, the three instances.

These were were groups of individuals that had formed their own organizations. They had envisioned themselves being in the, uh, in, in the investment and wealth management business. Only find that one of the primary objectives that each of them discovered among their higher net worth clients was. This long-term philanthropic strategy.

And, uh, all of a sudden they were like, well, we, we told our clients that we were going to be in the comprehensive wealth management business. Uh, we've gotta solve for this issue. And, uh, so I really, uh, I really look forward to, uh, to some of your comments on that. Myles, in our, our, our, our pre-conversation, we talked about the importance of, uh, what we refer to as mid-year reviews and.

June marks the, uh, the sixth month of the year. So we are, we're, we're technically very close to the midyear point. I thought it would be a good idea today to, to talk about midyear wellness checks, midyear financial checks, uh, given the, the uncertain markets and how that may be, uh, playing into some of the client's decisions around things like philanthropy.

So. Talk to us a little bit about your mindset around, uh, midyear checkups and what are you watching? No, a hundred percent. And, and you're right. All of a sudden, a wealth manager is now in the philanthropy business because midyear is a wonderful time to ask and speak to your clients and prospects.

Getting a sense of where they are on their financial picture, gaining understanding of where they are on their glide path as it relates to finances, but also as it relates to charitable giving. Think about discovering, I. What the vision is for their family, what the values are, guiding those decisions. Uh, should you coordinate a family meeting, as you said over the summer break now that it's June, or begin working with them and planning one for year end holidays.

Now, many families find that after reflecting on those questions, they can act on goals such as increasing savings, uh, investing more for retirement and plan. Their charitable giving with much more conviction. What I always say is, in summary, they're starting to form their why when it comes to philanthropy.

And it's our job as advisors and advisor coaches to really assist them in discovering and developing what their clients' why is, you know, you, you bring up something. I think that's, that's incredibly important. Um. I watch so many financial advisory businesses practices, uh, individuals spend a disproportionate amount of their time in the month of December, executing transfers to philanthropics organization, be them churches, mosques, you know, local community foundation, et cetera.

Uh, gotta get those donations in before the end of the year. That is a very reactive state to be in. And I think a lot of advisors, I think a lot of advisory practices feel that they are being proactive because they start reaching out to their clients, you know, mid-November, early November maybe, of. Plans for philanthropic strategy at, uh, at year end.

But, you know, you bring up a a, a great point. Those are conversations we should be having right now because good strategic planning. I, yeah, it could be as simple as, as donating appreciated stock to a. Charitable organization, but it might add a little bit more layer to it, like the utilization of a donor advised fund.

Maybe you want to, um, uh, do a community foundation donation. Maybe you want to create your own family foundation. And all of those take a tad bit more time than just directing appreciated stock to your local church or foundation. Right. You're 100% correct. Again, um, as. Thank you again for allowing me to be the coordinator of your charitable foundation management program.

I say all the time, why be like everybody else, including as you pointed out, your clients, why wait until the last two to three days of the year to make significant changes, including charitable gifts. Midyear reviews create a natural opportunity to broaden family discussions about legacy, providing structured moments to reflect on, uh, financial goals, family priorities, long-term aspirations.

Here at Cannon, we refer to them as the four Ls. Liquidity, lifestyle, longevity, and legacy, and charitable giving and legacy are teammates when it comes to philosophy and Phil philanthropy. Here's how you can have a meaningful conversation with those families in a number of areas. First, reassess financial and philanthropic goals.

Families can use mid-year reviews to evaluate charitable giving strategies, estate planning, wealth management decisions, and make sure they're properly aligned. It's also a terrific opportunity for you, the advisor advisory firm, to ask them to reflect on past charitable giving, uh, gifts, measuring their impact, making sure that both the community and the organizations that are receiving those dollars are still in their, uh, sites.

Here you're encouraging open dialogue. These are reviews that are providing a chance for all family members to discuss what their individual perspectives are on philanthropy, sure, but on wealth and fiscal responsibility, deepening and understanding and alignment between the family and yourselves. And then lastly, we're connecting generations.

Mid-year reviews provide us an opportunity or discussion to help bridge generational gaps involving younger family members. Conversations are about financial stewardship, charitable giving, and long-term planning, and here's an approach for the financial firms out there. Bring your younger individuals into those meetings.

They will now align and connect with that generation two and three. Now you have an opportunity to coordinate, uh, and choreograph, uh, generation conversations, uh, for years to come. You know, one of the best, um, best things that I've ever, ever seen in that, that vein, um, actually was, uh, with, with one of my daughters.

And, uh. Her, her grandmother, uh, worked with her to, uh, evaluate a couple of, uh, philanthropic groups, uh, for which donations could be made. Now it wasn't in any, you know, big formal structure. Uh, but I, I, I still remember that as being I. Just an incredibly powerful, teachable moment about, uh, the fact that, you know, we all have, uh, some responsibility beyond ourselves.

Uh, we all should have a responsibility of giving back, uh, especially if we've, uh, if we've been blessed beyond measure. And, uh, you know, I, I, I just remember that being a, a, an incredibly neat experience. So, uh, I'm glad to, glad to hear you bring that up. You know, we, we get questions from, uh, from clients all the time, uh, around issues of philanthropic planning strategies, et cetera.

Um, any updates for our clients on any, any legal changes or regulatory changes that have been going on in that space? I know that, uh, sure. You've been, you've been super busy updating your materials as I have, as well. What, uh, what have you been watching? Well, well, the, the simple way to put this is things change.

And that we're gonna continue to change, especially as it relates to tax codes and charitable giving. Um, there have been some recent IRS, uh, updates. You mentioned donor advised funds and certainly for charitable trust specifically in November of, of last year, the new IRS proposed regulations, key word there is proposed, um, clarifying the definition.

For donor advised funds, taxable distributions and equally important. Those are the positives. Then the, the conflicts of interest and prohibited transactions. These regulations aim to provide clearer guidelines and guidance for organizations when they are managing those donor advised funds. I mentioned qualified charitable distributions.

Uh, secure two put in a one-time election. The IRS now allows. One time distribution up to $53,000 in 2025 for an individual retirement account to go directly, uh, to charities through either a charitable remainder trust, a CRT, a charitable gift annuity, or a charitable remainder. Annuity trust, so we're not gonna go into alphabet soup.

You can come to the trust curriculum to find that out. This is all gonna be indexed for inflation going forward. But the bottom line, as advisors, let's take advantage of the current, uh, deductions that we know for your grossed, uh, uh, adjusted gross income limits before they possibly revert. We have strategies to implement donor-advised funds, charitable trust, endowments, et cetera.

Right? In summary, we collaborate with the advisors. To develop tax efficient strategies. While maximizing the input to the donor. That's awesome. So, you know, we get, uh, again, these, these questions from clients. So I'm gonna, I'm gonna pose, you know, a couple of scenarios to you that were, were posed to me. Uh, so I'm, I, I, I'm gonna test myself a little bit and see how I did, uh.

Relative to your, uh, your expertise in the area. But, uh, you know, when these, these clients came, uh, came to us and said, Hey, we're getting these requests from, uh, you know, from our client, you know, how do I even broach the, the topic? How do I engage in meaningful conversation if I'm not the technical expert?

And, uh, you know, one, one person was kind of funny. He was like, you know, I, I, I know you can deduct most charitable. Contributions. I don't remember the percentage limitations. And, you know, I know about donor advised funds. I couldn't tell you the rules on a family foundation or anything like that. You know, do I need to just direct them outside or do I need to have the conversation?

Um, how would you have responded to, to those comments? First of all, that's a great question and, and. You know, you can't be all things to all people, and that's the biggest issue. Many of the folks that we deal with, as, as you know, Phil at Cannon, are, are working in a team environment. And you don't have to be the expert if you're the relationship manager, you can bring in your CFP, you can bring in your fiduciary or your tax professional and, and as our value proposition at Cannon.

I'm sure, uh, many of the value propositions that are out there for advisor states, it's part of our job to to be the conveyor and communicator of the latest trends, issues, and opportunities within the marketplace. Um, what I've done as a prac practitioner in 40 years plus of I've developed se several sources and resources, both the other professionals and peers as well as organizations that.

I can lean on, and that's what I'm saying. I think you should be leaning on somebody that you're not providing, uh, information or stepping over the line or you're on the chalk line and being out of bounds. But it allows me to stay current, right? Whether it's pending legislation or change in the legislation concerns facing both donors as well as not-for-profit institutions, and then providing probing questions to the attendees of whether it's the course in Nashville or other courses that really differentiate themselves.

You can buy yourself time by asking additional discovery questions of your donor before you have to say that the, you know, the donor-advised fund le level, or I mentioned before, the $53,000 over the $120,000 that you can, uh, uh, take out of your IRA, either through a. Qualified distribution or qualified annuity.

Got it. So, uh, number one, I, I, I feel much better now. Uh, we, we we're, we're, we're in alignment on that. Uh, my, uh, my, my comments to this individual were, were very similar to yours. I said, listen, you know, in, in my experience, I, I don't know that I've ever met. An advisor that was the global expert in every, in every issue that a client may face over the course of the journey.

I did say that philanthropy is a key component of almost every financially well off family. It it, it's something that they do, whether it's as simple as checkbook, philanthropy or more complex to the point of having their own family foundation. I said, so it, it behooves you to have. Experts, whether they are within your firm or if you have to go outside your firm and, you know, find people in your local market area that, that are the technical experts in the area.

Um, and you know, if you're engaged in a, in a conversation with a client and a client says, Hey, you know, what do I need to be thinking about there? It's your ability to say, this is the exact reason that I partner with great experts like. Myles McHale, who, and then Credentialize you as that expert. We need to take advantage of Myles' expertise in this situation so that we're thinking through all of the details that are gonna be important to you, Mr.

And Ms. Family. Now, I do know a couple of questions that Myles will have for me when I place the phone call to, to establish the, uh, appointment. And then I can pose those, those couple of questions. Now, those couple of questions I would've gotten from you Myles, because in our meeting I say, Hey, what are the one or two things that you're always gonna want to know if I bring somebody to you and, and, and make that introduction?

And, uh, that, that seemed to work, uh, exceptionally well. And I do think it's the responsibility of, of every advisory practice that you've got a network of professionals from the legal, from the tax and philanthropic. You know, you play it all the way around that, that you can go to and you really ought to be cultivating those relationships at least on a quarterly basis.

You know, if it Myles, if you are my philanthropic expert, if you and I aren't having lunch once a quarter, which we should do, we're having a phone call once a quarter and I'm saying, Hey, Myles, you know, what are the two or three. You know, biggest things going on in the space right now, so that I'm constantly aware of changing dynamics like the, the, the proposed legislation that you talked about earlier, so that when I'm with clients, I.

I, I'm not telling them what the law changes are gonna be, but I've got the ability to say, Hey, you know, in conversations with Myles, he did mention that there's some adjustment numbers that are potentially coming that's gonna be indexed it. It's a great planning opportunity. Well, now this conveys to the client.

That, Hey, we are in that space. You know, we, we, we've got our focus in the right way. Um, so I I I love that. That's, that, that's, that is awesome. Awesome, awesome. Can I just add, can I just add, because you please, in, in, in schools and when you do a great job kicking off the orientation, you mentioned sometimes tongue in cheek about the model that individuals show their clients.

Right? And that's the wheel, right? And this is the validation of the wheel that you are actually using the subject matter expertise that you have in retirement. In investment management, in estate planning, and in philanthropy that you are now truly offering. You said comprehensive. The other buzzword is, uh, holistic.

Right? It's, it's being able to say, you know what, I don't have the answer, but we do. And I believe that's very powerful. That's, that. That is awesome. Um, any other conversation, hints or ideas that you would offer, uh, for folks thinking about I. You know, pushing this, this angle a little bit more. I, I, I would tell you a couple things.

As we said before, the biggest insight as we mentioned earlier, is determining the client's why, right? Why is the client considering charitable giving in the past and in the present? And if after they pass away from this, Eric, from a comprehensive standpoint, the program that we put together in Nashville really identifies charitable planning opportunities.

Rather than just having me or you, Phil, just talk to people, it's the engagement of the constituency that attend. Now let me talk about that for two seconds. We have really three components. One, the, uh, financial professionals that are, um, involved in the space and wanna learn more. Two, um, a recently, uh, anointed, um, executive director or planned giving, uh, coordinator of a charity.

They, they, good news is they're promoted. The bad news is they now realize they have to raise money and have these donor effective conversations. A two day course in Nashville is a pretty ju, a good jumpstart. And then finally, which I really liked, the combination, if you will, the triangle that I'm building in your and framing it in, we've gotten in the last three years, two or three individuals.

That are citizens of the community that are sitting on boards or forming a family foundation, and they wanna know more how to do it the right way from a governance, from a, a coordination structure, from a whole bunch of different standpoints. I love that because working with Canon, we are helping the advisors, the community, and the not-for-profit.

Staff to have a clear client understand the clear client need and differentiate their firm or their not-for-profit from the competition. Conversation starters are really, uh, important from a whole bunch of different standpoints. And let me frame it in using, um, for the audience and you by using what I refer to as canon's top five charitable discovery questions.

In addition to addressing why we need to ask and have open-ended questions that talk about what. How, when, who else and where. Going through those briefly, what are the most important charities or philanthropic causes that you and your spouse have supported over the years? What have you done for that charity during your life?

Explain that to me. Tell me more. One of my favorite phrases. And what do you intend to do for those charities at your death? How, how or what, in what ways have you provided support, volunteer time and talent? Financial support as you mentioned before, Phil, are you writing an annual check? Are you donating appreciated securities, donating property?

And then the other, how is really a, an elite advisor question, how did that make you feel? That question, why is it an elite advisor question? Because you have connected now a emotion impact and as we said, one of the four L's legacy when. What charitable commitments have you and your spouse made or planned to make?

So there we're involving, um, estate planning or, or, uh, documents. Who else, who else is included? And this is the connection, as I said before, with generations. What have you done or would you, what you like to do with your advisory team's assistance to incorporate your children or your grandchildren into this process?

How would that aid you and your spouse in passing the values on to your family? What you're really thinking about, what I mentioned at our first couple seconds together is think about family meetings and then finally where, where are you finding the funding sources for those, those assets? What, how significant of a gift are we talking?

Are we a crawl, walk, or run? Crawl being your annual support, a walk, uh, fill, putting together, and, um. Funding a donor advised fund? Or are we talking about assets that are significant enough to consider a family foundation? And until we understand all of those, and especially the funding sources for their giving, for all intents and purposes, we're half baked.

Or is, uh, Bon Jovi would say We're only halfway there. Is it through a trust? Are we using an IRA, possibly using a QCD qualified charitable distribution? Will we be working with the local community foundation? And I know you had my partner, Sarah, from the Athens Community Foundation, uh, on a couple weeks ago, so getting the answers to all that series of questions really provides you two payoffs.

One, I can guarantee you I can't guarantee a lot, but I can guarantee you if you've gone through those discovery questions and listened, you will have deepened your relationship with your client because you asked and you listened. You just didn't show up with an answer. And. With your subject matter expertise and have, we've been talking about with your partners, you are now part your teammates, you are now partners with their legacy and charitable efforts for a long time.

Wow. That is, I, I've just, I, I think about that. That is, that is so good. And again, that's, that's part of what the experience for, uh. For the program that, uh, that you teach in, uh, in Nashville every August, uh, is all about. And for our listeners, we'll include in the show notes, uh, links to, uh, to that program so that if, uh, anyone's interested, they can get more, uh, more details.

I. So, uh, today is, uh, Friday, June the sixth. Tell me between now and uh, the time that everybody's gonna take a, a couple of days away for the 4th of July holidays, that what, what are some specific action steps that advisors can take over this next 28, 30 day period of time that can make an impact on the lives of their clients, can make an impact on their business?

In 2025. Well, I love that question. So your question is why now? And, and as we said, um, and, and had had projected, unfortunately, charitable philanthropies left on the table very, very often. Recent surveys say 85% of clients want their advisory, the advisory teams to bring it up. Only 30% are bringing it up proactively.

I, I, I would tell you a couple things. I think we're at a, a significant crossroads or inflection point with financial planning, wealth management and, and charitable giving. The great wealth transfer that's going to occur or has begun. And advisors are now using their empathy and communication skills and mastering the, the meeting, if you will.

But they need to understand that they are not only talking to. You said, Mr. And Mrs. Customer, I referred to 'em because of my, uh, my age. Mr. And Mrs got rocks from the, uh, uh, Flintstones back in the day. If you're working with clients that run a family business, it's, it's really critical that generation two and generation three understand that their advisor, you're looking not out just for the family business, but you're also looking at it this holistically.

'cause that's an asset that may store, uh, the legacy that families values, but also provide. Employment and future income for future generations to come. So understanding, right Phil, if you're understanding that you're leaving charitable giving off of your agenda, don't be surprised if you don't bring it up.

Some other advisory firm or investment house does. And you have a significant chance of losing that family relationship. If you don't feel comfortable speaking to those issues, I think you have a great opportunity. I would strongly suggest that you attend our session in Nashville this coming August, and don't be.

Held back by, uh, waiting for the tax law to change. You and I were in the business back in 2012 when all situations was going to revert back to a million dollar, uh, exemption, and that didn't happen. You know what things change, as I said before, especially as it relates to legislation. I try to get this right.

I, I stumble all the time. The tax cut Job Act, the TCJA is set to expire, as we talked about before in 2025. Bringing significant changes to everything that we discussed. As a wealth manager, your clients are relying on you to navigate these shifts. Now, Congress is working diligently and may extend and continue many of these great tax break breaks, but before they do that, as fiduciaries, we know we can only speak to our client about what we know, not what we speculate, what may or may not happen.

No one knows which parts of the TCJA. We'll be extended, replaced, or allowed to sunset. And finally, as we say at Canon all the time, it's better to plan now and adjust and act later. Personally, I add no one has ever been successful by saying Ready, shoot, aim. Great, great point. Well, uh, Myles, it has been an absolute pleasure having you, uh, on first write of feedback.

You've given some, uh, fantastic insight and, uh, some intellectual challenges for people to consider as they, uh, engage with their clients in the area of, uh, philanthropy. Uh, additionally, uh, have your contact information in the show notes if anybody wants to, uh, to reach out directly to you. But thank you Myles for your perspectives and insight.

Thank you, sir. And, and thanks to all the Cannon staff for what they do for so many fantastic First Friday feedback is the production of Cannon Financial Institute, executive producer of First Friday. Feedback is Sarah Jones. Editing and mixing is done by Danny Brunner. Uh, so until next month, July, I am Phil Buchanan.

Wishing all of you the very best. Bye-bye for now.