The son of a Norwegian immigrant who arrived in America with no knowledge of English and about $10 to his name, Marvin Johnson grew up during the Great Depression in a family without a lot of money, but not what he considered poor.
“We raised chickens and had a big garden so we always had a lot of food,” he recalls.
Like others of his generation, he became the first member of his family to go to college. After graduating from the University of Minnesota, he joined the Air Force and after that he returned to college for a degree in business administration. Shortly after moving to West Virginia for his first job with Union Carbide, some friends invited him to play bridge and he met a woman named Peggy, to whom he’s been married for 50 years.
Today, he and Peggy are retired from his career in human resources and hers in nursing and they’ve settled in Camdenton, where they are both active volunteers and philanthropists in their adopted hometown.
And they are an example of how the CFO works with wealth advisors to establish externally managed funds.
“It’s a win-win-win-win for the client, the charities, the community foundation and the advisor,” says Jami S. Peebles, Executive Vice President & Regional Manager at Central Trust, who asked the Johnsons to share their experience during a Professional Advisors Council panel discussion at the annual Affiliate Conference in March.
“I was so in awe of what good people they are,” says Peebles, also a member of the CFO’s Board of Directors. “They do great things, they give back to their community. They could just write a check, but they get personally involved and emotionally involved.”
Indeed, it’s daunting to hear them tick off the activities they’ve been involved with over the years: Habitat for Humanity; St. Anthony’s Church; the Service Corps of Retired Executives; the Sheltered Workshop; Meals on Wheels; Literacy and ESL tutoring; the Quilt Guild; and the Lake Area Ministerial Alliance (LAMB) Emergency Shelter, which they suggested for donations in lieu of 50th anniversary gifts. That’s not counting their hobbies: golf, an investment club, sewing, quilting, gardening, and traveling through the winter in a home-away-from-home RV.
Before the Johnsons were referred to Peebles, they didn’t know about community foundations. When they learned about the concept of collective donations and gifts on behalf of communities, they were intrigued. Marvin said they decided to set up their externally managed donor-advised fund for three reasons:
“One — I like to take the tax deduction since I often disagree with how the government spends my money; two, we like to recommend grants — Camdenton is a small town and we can see the results of our donations; and three, we believe we can accomplish more together than separately,” he says. “By combining our donations with a lot of others, I think you can have a much bigger effect.”
They are careful about their giving decisions. They give to their family’s alma maters of the University of Minnesota, Ohio Dominican and Viterbo University in Wisconsin, and their church. For service agencies, they check out their administrative overhead and how much they spend on fundraising events.
“We want to help agencies that help people who help themselves,” Peggy says, of groups like LAMB House, which helps with emergency needs more than long-term support.
Adds Marvin: “We’ve been very fortunate. When you see the needs that are out there, in some cases, it’s of their own making, but not always.”
As Peebles says, directing giving to your community makes people feel “they are a part of something bigger.”
For the Johnsons, who moved to Camdenton in 1989 and built their house at the top of land that had nothing but a logging trail, they’ve lived here longer than anywhere in their adult lives as Marvin took transfers every few years in his jobs for Union Carbide and Abbott Laboratories. Their volunteering and hobbies gave them opportunities to meet new people and settle down.
“There are a lot of opportunities for volunteering,” he says. “It doesn’t always have to be money. You can find something that’s going to contribute to the community. There’s always plenty to do.”
Externally Managed Funds
With externally managed funds, the CFO and the wealth advisor each can negotiate a reduced fee. The clients can continue to work with their money managers in whom they have confidence, while using the CFO to vet charities and offer resources on community issues and priorities. A donor-advised fund also offers tax advantages over a private foundation, Jami Peebles says.
For more information on externally managed funds, contact: Winter Skelton, Development Operations Officer, (417) 864-6199 or email@example.com.