Thirteen years ago, Teri Hansen's father gave his 11-year-old granddaughter an unusual birthday gift: He established a donor-advised fund in her name-a fund placed with a charitable organization from which a certain amount would be donated to charities each year. The grandfather, a retired wealth manager, told his granddaughter she would be the fund's adviser, and they would watch it grow together.

Three months later he died of a pulmonary embolism. The 11-year-old, now 24, has been recommending grants every year with her grandfather's interests as well as her own in mind.

"She thinks of her grandfather all the time," says Teri Hansen, president and CEO of the Gulf Coast Community Foundation of Venice. "It will have meaning and impact for the rest of her life."

While donor-advised funds are not new, Hansen's father's gift has the hallmarks of a new kind of philanthropy that is taking hold in America today. Donors aren't just writing checks, they're establishing funds in which future generations can participate; they're donating real estate; they're even handing over the reins of their businesses.

This new breed of donors is more hands-on and more results-oriented, even asking nonprofits for a business plan before committing funds. And their goals are loftier. While yesterday's donor wanted to feed a hungry child, today's donor aims at eradicating hunger, AIDS and malaria. This is perhaps best personified by the Bill & Melinda Gates Foundation, which, with almost $30 billion in assets even before Warren Buffett's $31 billion gift last summer, is by far the largest philanthropic foundation in America.

Today's donor has the funds to commit to serious change. More money is floating around the philanthropic world than ever before, partly because of the start of a massive transfer of wealth to boomers that will reach $41 trillion by 2052, and partly because people are making more money than ever before.

Americans donated $260 billion in 2005, a 6.1 percent rise over the previous year. With that kind of money comes change. The nonprofit world is becoming more strategic and more businesslike, turning to a new infrastructure that has developed to service it, with groups that consult with foundations and philanthropists or link volunteers and money with recipients. The financial world is not far behind, with wealth managers, attorneys and accountants eyeing a piece of the philanthropic pie.

"It's turning from a word-of-mouth cottage industry to one that is looking at philanthropy as a very large industry out there," says Lorna Lathram, director of philanthropic services with the Indiana University Center on Philanthropy. "More organizations are coming up to private and nonprofits to service the industry." Lathram's organization offers sessions on giving; couples' philanthropy is especially popular.

The New Wave

"More diverse people are getting involved in philanthropic giving," says Daria Teutonico, director of new ventures in philanthropy for the Forum of Regional Associations of Grantmakers. "It used to be the stereotype: wealthy white males. Now there are more people of color, young people, and many more women than a decade ago."

Everyone is eyeing the baby boomers. A previous generation of philanthropists tended to be old money, the sort of donors who gave out of noblesse oblige, attended black-tie galas, endowed foundations and gave their names to museums and opera halls. The new breed made their own money, often in the stock market or IT boom of the 1990s, and want to innovative ways to cure the world's ills. And they want to stay as involved in their philanthropies as they were in their careers.

"Because so much of the wealth has been earned, people are much more engaged," says Lathram. "They approach philanthropy as their next career."

"Boomers came of age at a time of social change and upheaval," agrees Susan Price, managing director of family foundations services at the Washington, D.C.-based Council on Foundations. "A lot of them have a real sense of desire to be engaging in making the world a better place."

Like boomers, says Hansen of the Gulf Coast Community Foundation of Venice, growing numbers of younger philanthropists in their 20s and 30s tend to take a more businesslike and entrepreneurial approach to philanthropy.

Funders are also taking a more businesslike approach toward pooling resources, says Scot Marken, president and CEO of the Donors Forum of South Florida, a nonprofit that provides technical assistance and community research for private and public funders. "Historically, people gave money without asking questions," he says. "People are now asking, 'Can you figure out if the money we gave you is making a measurable outcome?' There's also more partnership and collaboration among funders. They can't always go it alone; it's more effective if they collaborate and not replicate."

For example, after Hurricane Wilma last year, 12 different South Florida funders got together to provide emergency services and help nonprofits. They created a common application form and held meetings every few days to combine projects and eradicate duplicate work. Within a couple of weeks, says Marken, the group had distributed more than $1 million in assistance.

Corporations also are combining business and philanthropic values. Marken says few companies in Florida have full-time staff to handle philanthropy. The job usually falls on the human resources or marketing people, and Marken says they have become more sophisticated in doing more with less. Corporations are creating deeper partnerships with nonprofits and leveraging assets other than cash, such as allowing employees to give technical assistance.

In fact, cash may not be the best donation, says Hansen. "When you think about your own wealth-house, stocks and bonds, IRA-cash position is only about 15 percent of total net worth. Yet 100 percent of people's giving tends to be from their cash, so they are leaving 85 percent of their wealth out of charitable giving."

That's changing, she says. Currently, people are giving her organization everything from livestock to oil and gas rights, shares of an NFL franchise and partial interest in a slip on Pier 57 in San Francisco. While philanthropists might earlier have gifted an entire art collection to a museum upon their death, today's donors can endow a charity with 75 percent of the value of an art collection that stays in their home. The charity, in turn, will take care of the art and cover insurance while the donor vacations elsewhere.

The Gulf Coast Community Foundation of Venice recently created a new arm, Gulf Coast Strategic Investments, to manage the more complicated gifts, including small businesses.

"A lot of us have created our own companies," says Hansen. "We look down the road and see that when the entrepreneur dies, the company may be broken and sold for taxes. We say, 'If you want your legacy to stay intact, gift your business to us. We'll continue to operate and give a stream of income to your family through a shared situation.' A lot of entrepreneurs are waking up to those sorts of ideas."

Through donor-advised funds, donors may gift an amount of stock and structure grants to be paid off over a series of years. These are a good alternative to setting up a foundation because they're flexible and involve no administration or research costs, Hansen says, yet allow the donor to participate in giving out the money. Corporations can use them as creative ways to practice philanthropy by matching employee's contributions or having employees decide on grants.

While these funds have been around a while, what's new is that they are being used now also as a way to involve family members and share values, teach children and employees and connect to community, says Hansen. One family she works with has one fund for each of three daughters, ages 11, 13 and 15.

"Each gets to invest the money the way they want to, and on the kinds of things they want to," says Hansen. "It's fascinating to see how they interact."

In Sarasota, Stewart Stearns, president and CEO of the Community Foundation of Sarasota County, says he does see that people are giving more, which he thinks is because their motivations are moving away from their checkbooks and back to their hearts. He cites the example of a woman who came with her tax advisers to donate a large sum to the Community Foundation.

"I said, 'After you pass on, where do you want the money to go?'" Stearns recalls asking the woman. "She said, 'I don't care, you can take it to the Bahamas if you want.'" After some probing, Stearns learned that the woman had been a teacher, and that she had found the expenses of training very onerous. So Stearns suggested using her money to endow teachers' training scholarships.

"She looked at me like she had found another religion," says Stearns. "I do believe that giving has become less out of obligation. I think now people are doing it because they see that they can continue to make a difference."

NO MORE SPOILED RICH KIDS

Extravagant hotel heiress Paris Hilton is a nightmare example of what parents and grandparents want to avoid as they pass on their riches to the next generation. Fortunately, resource centers and wealth managers are developing new products and services so the wealthy can transfer their values of hard work and philanthropy along with their millions and billions.

R. Wayne Snider, a wealth advisor with Comerica in Sarasota, says a newer trend is incentive trusts. Essentially, these trusts tie any inheritance to the income the children make. The more they earn by their own sweat, the more money they get from the trust. The trusts tricky to set up, says Snider, because it's not always easy to determine earned income. "Still, when properly done, they could ease the parents' concerns about a child simply taking the trust income and moving to Aspen to ski and 'find themselves,'" he says.

John Daley of Lakewood Ranch-based The Daley Group combines wealth management and family counseling with a trademarked procedure called The Heritage Process. Daley begins by establishing a family council with his clients, whose net worth is usually $5 million and up. Parents draft the family council bylaws-who the members are; who has voting rights-and as years pass, children begin draft resolutions. Councils hold annual meetings (usually in a resort setting) where generations exchange lessons on investing and personal improvement.

Daley conducts leadership exercises to help "pass the baton from one generation to the next," and turn the family into a team that can communicate and achieve mutual goals. Daley spends a large amount of time with the clients the first year (about 50 hours for the first family council); his involvement-which costs $30,000 to $300,000-tapers off during the subsequent years.

One couple Daley worked with was a significant longtime contributor to United Way. Their grandson, on the other hand, considered social services as enablers for the poor. For the first two years of the family council, no money changed hands between generations, but values were shared and discussed during structured sessions. As part of the process, the grandson was required to volunteer with the audit committee for United Way, which opened his eyes to other organizations, such as a teen shelter, a battered-women's shelter and a soup kitchen.

"He realized that, for many people in America, being poor is not a question of choice but of circumstances," says Daley. "We built the structure so the young man would understand [that]. We help families articulate what's important."

While many of his clients are fairly cohesive-he even works with five generations of one family-it took him two years to get all the members of another family into one room together. Sometimes, Daley says, nonprofits will engage his services with donors when they see a disconnect between donors and their heirs.

Matthew Bower, senior vice president of the US Trust Company in Sarasota, says US Trust also holds sessions around the country to give families guidance about the meaning of money and good stewardship of family legacies. Bower says parents are trying to empower children by having them server as board members of foundations and participate in grant awarding.

"Now people want kids to embrace a cause, be involved, not just have their name on a building," Bower says. "It creates involvement, passion and creativity."