Wealth Insights

How private foundations can unite families around purposeful giving

Private foundations create a shared mission that spans generations.

A private family foundation is more than a charitable vehicle—it’s a powerful platform for uniting founders and future generations around shared values, purposeful giving, and long-term community impact. “When designed intentionally, a private foundation becomes a living expression of a family’s beliefs, priorities and vision for the world they want to help shape,” says Steven Sommers, Philanthropic Solutions Area Manager.

At its core, a private foundation allows founders to formalize their values and translate them into sustained action, establishing a clear mission that reflects what the family stands for. This clarity creates a shared language across generations, anchoring conversations in “why we give,” not just “how much.”

A powerful aspect of a private foundation is its ability to bring multiple generations to the same table. Children and grandchildren can participate in governance, grant evaluation, site visits, and community engagement in age-appropriate ways. These shared experiences foster connection, mentorship and accountability. Younger generations gain exposure to responsibility and impact, while founders have a structured opportunity to pass on wisdom and lived values.

Warren Buffett’s family philanthropy is a great example of this. His three children, Susie, Howard and Peter, lead their own foundations that receive large donations from him. They operate these entities in a way that aligns with their father's lean corporate philosophy. Philanthropy became a training ground, preparing them to become thoughtful stewards.

Buffett recently wrote of his approach to preparing his heirs to carry out a philanthropic legacy: “If my children simply do a decent job, they can be certain that their mother and I would be pleased. Their instincts are good and they each have had years of practice with very small sums initially that have been irregularly increased to more than $500 million annually.” Buffett’s approach underscores a key principle: values are best transferred through participation, not instruction alone.

But you don’t need Buffett’s wealth to benefit from his example. Private foundations serve as powerful educational tools. Through defined roles, next-generation members develop leadership skills, financial literacy, ethical judgment, and a deeper understanding of community needs. This experiential learning embeds values effectively.

Beyond the family, a private foundation strengthens ties to the broader community. By engaging directly with nonprofits and local initiatives, families become partners rather than distant donors.

Ultimately, a private foundation is a legacy structure—not just for wealth, but for meaning. It ensures that generosity, service, and purpose are intentionally cultivated and carried forward, creating alignment across generations and lasting impact in the communities that matter most.

4 Benefits of a Foundation:

• Family engagement. Uniting generations around charitable goals by giving children and grandchildren roles in the foundation.
• A family legacy. Often established to exist in perpetuity, a foundation can help pass on your mission, vision and charitable legacy.
• Tax benefits. Transferring assets to a properly structured private foundation may reduce federal estate tax exposure. Donating appreciated assets may allow donors to reduce or eliminate capital gains tax on the appreciation, subject to IRS rules and limitations. The foundation can then sell the assets and use the full value for charitable purposes, subject to a 1.39% excise tax on net investment income.
• Greater operational control. You decide how it operates, choosing its mission, board members or trustees, and determining how assets will be invested.

Talk to your Regions Wealth Advisor about:

1. How starting a foundation might fit into your current wealth plan.
2. How to hold a family meeting about philanthropic values.

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If you’d like additional philanthropic guidance, reach out to us or explore our nonprofits, endowments, and foundations capabilities.