Financial adviser refines the art of charitable giving

Next to his family, Claude Rosenberg Jr.'s greatest joy is giving away money.

He's refined it to a science, complete with philosophy and formulas. He's written a book, and travels around the country teaching Jewish and other organizations how to use his theory to increase their fund-raising. Practicing what he preaches, his talks on charitable giving are labors of love.

Rosenberg began revamping his attitude toward philanthropy years ago. As founding partner of RCM Capital Management in San Francisco, he realized he and his wife, Louise, were not as generous with their charitable contributions as they should be, considering the income and assets they had accumulated.

His mistake, he decided, was using income as the sole basis for determining donations.

"When people look at what they can [give], they should not look at income alone or even appreciated securities," says Rosenberg. "When tzedakah first came about, it was an agrarian society. If they had surplus crops then they were encouraged to share with others. No one would think of suggesting they give up their assets."

But Rosenberg does. He advocates considering all assets for the purpose of giving.

Many people can afford to dip into assets and increase their giving-power without any ill effect on their lifestyle or financial security, he suggests.

In his 1994 book "Wealthy and Wise," Rosenberg explains this philosophy and gives people the formulas to apply to their own finances. Having handled other people's money for 40 years, Rosenberg is quite knowledgeable on the subject.

"We're all not as rational as we'd like to be when it comes to the delicate subject of money," says Rosenberg, who has seen all kinds of bizarre behavior when it comes to finances. "My job is to talk common sense to people. Many people have seen their wealth go way, way beyond what they expected. Their giving seldom goes up in proportion to their wealth."

So Rosenberg urges people to reduce their wealth. Not only is it sound financial advice, it's good for the soul, he maintains.

Charitable giving is a win-win situation: Agencies are more effective, donors feel fulfilled and the world becomes a better place for everyone.

"One reason people shy away from giving is because they don't feel fulfilled," says Rosenberg, who recommends consolidating donations and investing a lot of money in a few organizations, rather than the reverse.

A sizable donation gives the donor a sense of control over how the money is used and a feeling of partnership with the charitable organization. Involvement brings fulfillment.

"The more money you put in, the more you feel comfortable asking to come over and see what's going on," says Rosenberg.

He recommends divesting assets in life rather than in one's will. Better choices are made when an individual is younger and healthy, he says, and the donor has the joy of seeing the benefits of their giving.

Rosenberg disagrees with noted Jewish philosopher Maimonides about anonymous giving. Seeing a particular name on a donor list often stimulates others to follow suit, he says.

"If we need that encouragement, then that's OK." However, Rosenberg admits to being skeptical about people who need their name on everything.

Rosenberg, a Stanford business school graduate, grew up in San Francisco in the 1930s, when the unemployment rate was 25 percent. The memory of people coming to the front door of his home, asking for a sandwich, had a lasting effect on him. And he wondered what he would do if that happened at a time when he was financially solvent?

Rosenberg found his role model at his first professional job at J. Barth and Company, an old-line San Francisco investment firm. Both partners were Jewish, philanthropic and encouraged their employees to be the same.

When Rosenberg opened his own firm in 1970, he established a charitable foundation funded by a percentage of the partners' income. Eventually the management of this trust was taken over by his wife.

Tzedakah is a family matter in the Rosenberg house.

"It's a partnership that we do together," he says. "Philanthropy practiced intelligently can have a wonderful effect on everything — starting with a marriage. If we don't do it, how can we be great mentors for our children, nieces, nephews and grandchildren?"

The Rosenbergs' four grown children are active in and donate to various charities.

"We're a close family that cares," says Rosenberg. Our children "may all have different favorite [charities] and that's good. Prioritizing is important because you feel good about doing the things that are important to you."

According to Rosenberg, Jews are known to be more generous than other groups. And that's as it should be, he says, because Jews have a greater sensitivity to the needs of the less fortunate because of a heritage of oppression and discrimination.