TFP: Giving is part of proper financial planning

The head of growth and financial life planner at TFP Financial Planning said most clients were interested in supporting individual causes and giving, whether it be time or money, could be hugely beneficial for people's retirement.

He said: "The psychology of giving - giving our time and money to people and causes that are important to us, gives us a huge sense of happiness and wellbeing.

"That's the next stage of proper financial planning. For me anyway, it's this giving of time and money. Because if we want to create a happy, healthy, wealthy retirement that has to be part of it.

"It doesn't have to be £100,000, it can be time, it can be £500, it can be doing something."

TFP late last year set up a community foundation administered and run by the Essex Community Foundation, after deciding there was more the firm could do to give back than raise money sporadically for individual charities throughout the year.

We are building a business that has legacy, not a business to gather assets to shift on to some consolidator.

Whereas previously it would pick one to three charities and raise funds through various activities throughout the year, it now channels its proceeds into its community fund, and Essex Community Foundation then allocates the funds to charities on behalf of the firm, giving TFP the opportunity to specify geographical areas within Essex, and the types of charities it wants to support. 

"It kind of got to a point last year where we felt that there's something better that we could do, something that we own, something that is more personable to us as a business and something that impacts the local community much better and has legacy," said Haylett.

"We are building a business that has legacy, not a business to gather assets to shift on to some consolidator in the next five years.

"So we wanted to have something that has long term foundations."

This year the plan is to start putting any money raised into the charitable foundation on an ongoing basis, a few years down the line TFP plans to be in a position to donate some 10 per cent of its profits too.

TFP has specific causes in mind, which are often linked to personal experiences within the team, said Haylett. "Mental health is massive for us," he said.

"[And] we're very much around premature babies and supporting mums. There are wonderful little local charities where £500 to help buy special little nappies is going to have much more of an impact than £5,000 to a massive global charity."

The way the community foundation works is a donor only gets full control over where the money goes after it has raised £25,000, ideally within the first three years.

TFP anticipates that it will be able to raise between 10,000 and 15,000 pounds a year, before any other donations and profit are added.

"At the moment we're building up that pot of money to have a significant amount to then give out. Our long term target for this fund is we want a million pounds.

"That might take 10 years to get there, but we want something significant that just builds and builds and builds."

Employees and their partners regularly participate in sports and other fundraising events, and the firm offers fund matching and gift aid. It also runs a golf day, which is designed to fundraise, and a charity gala.

But the foundation also invites clients to get involved. "I've got one particular client who set up his own charitable foundation through this [Essex] community foundation as part of his planning work, others that are interested," said Haylett.

"A lot of people that we talk to have got specific causes or specific views that they would love to be able to support with time and money post work.

"And so it gives us the ability to take all that wonderful work and conversations that we have with them about purpose and aligning their money and giving them an avenue to do it."

Giving time

But it's not all about the money, the foundation also enables the TFP team to have volunteering time.

"One thing that we're looking to do is to give each team member a day a year to go and do something, and that would be linked to the things that we're supporting.

"So ... there might be a particular charity that needs their books looked at or a finance spreadsheet or something.

"Or it might be that they're doing something where it's physical work and we need to help paint a room or something for it enables us to then really get our hands dirty and give back time as well as money, which is equally important for us."

Structured charity work, said Haylett, "creates an environment for the team to have a common cause, which is really important for us.

"I think it just creates a purpose, a kind of additional purpose to us building a long-term business. It gives us another strand to have as motivation to build a long term business.

"We're all very similar in that we want to impact our community. And we feel that this vehicle is one of the best ways for us to impact of our community."

carmen.reichman@ft.com

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