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Congratulations! You have been accepted onto the board at a local nonprofit. This got your picture in the newspaper! It might be a small nonprofit where everyone on the board does everything from running committees to setting up chairs. You might be on the board at the hospital ot the museum, rubbing shoulders with local CEOs and philanthropists. How can you avoid blowing yourself up?
Why should that be a concern, you wonder? You have been a hardworking volunteer. You earned your stripes. You have written out checks and socially networked in a tactful, ethical way. Why should you be worried about blowing yourself up?
Here is the reason: You are not the first financial advisor to be involved at a local nonprofit. If they haven’t had one in their group before, they belonged to another group with firsthand experience of “advisors behaving badly.” People are watching.
Here are ten mistakes you must avoid:
1. Doing nothing while serving on the board. You serve on the board in name only. You never attend board meetings. You always have an excuse. You don’t serve on any committees. You don’t support their events.
Bad because: You come across as only on the board to enhance your resume.
Instead: Before you accept, learn about the expectations of board members. Live up to them.
2. Talk about confidential board business outside the boardroom. The organization might be in financial trouble. You tell others in your circle of friends. The board is involved ion deliberating hiring more staff or staff reductions. You tell staff members what is going on.
Bad because: You have violated confidentiality.
Instead: Leave board discussions in the boardroom or only continued with other board members. Destroy papers used at the board meeting or leave them with a staff member at the end of the meeting.
3. Promise but don’t deliver. You said you would serve on a committee. You don’t. You said you would chair a committee or get a project done. You don’t. You said you would provide an introduction to a potential donor you know socially. You don’t.
Bad because: You are not following through on your commitments. Someone must pick up the slack.
Instead: Be careful what you commit to doing. Under promise and over deliver. If you have committed, get started immediately.
4. Keeping your wallet closed. The nonprofit holds one major fundraiser a year. You don’t buy tickets. The charity has an annual appeal in December. You don’t write a check. You skip out on the capital campaign too.
Bad because: You appear to be lending your support physically, but not financially. Everyone knows you can afford it.
Instead: Be the first to but tickets or write a check. Demonstrate leadership.
5. Not paying your fair share. You do commit to buying tickets to the gala. You stand up to pledge money at raise the paddle time at the gala. You don’t pay up on time. The staff needs to chase after you to get a check.
Bad because: It appears your personal finances are in poor condition. Who wants a financial planner who cannot manage their own finances?
Instead: Be the first to pay. Either write a check when you commit or pay online by credit card.
6. Becoming a professional guest. You have made new friends at your nonprofit. You might be a regular member, not a board member. They invite you out to dinner and insist on picking up the check. You let them. They invite you to their home. You do not reciprocate.
Bad because: Someone is watching and counting. You come across as a freeloader.
Instead: Keep track. If they took you out for dinner, invite them out for a meal and pay. If you have been a guest at people’s homes, plan at least one party to payoff your social obligations.
7. Speaking disparagingly about the organization or events. You attended an event put on by the organization. Something went wrong. Maybe there wasn’t enough seating. Perhaps the program ran too long. Afterwards, you tell others in the community it was a lousy event.
Bad because: As a member of the organization, you are an unofficial ambassador. These problems really happened, but word gets back you are part of the problem, not the solution.
Instead: Get involved with the staff or committee when they review the event. Help review the pros and cons, try to make positive suggestions how to remedy the problem next time.
8. Coming across as only interested in getting business. Have you ever visited a store, been approached by a salesperson who followed you around, not leaving you until you exited the store? If you bring all conversations around to business, people think that’s the only reason you are there.
Bad because: This only works at the Chamber of Commerce or networking clubs. Nowhere else.
Instead: The organization is the shared interest bringing everyone together. Start there.
9. Starting every new conversation with “Let me tell you what I do.” This is similar to the salesperson attached to you in the store. People don’t like being sold. They think you only see them as a wallet with legs.
Bad because: They think you are one dimensional. You are a salesperson. That’s it.
Instead: People like talking about themselves. Draw them out. They should repay the favor.
10. Asking everyone if you could look at their investments. Can you imagine riding in a crowded elevator and feeling someone’s hand in your purse or pants pocket? It would feel like an invasion of your personal space.
Bad because: This is a “crossing the line” experience. Word will spread. People will avoid you.
Instead: Listen for clues. If someone reveals a financial need, speak with them privately and quietly later. Confirm their interest before proceeding.
Some unknown financial advisors or insurance agents created a negative perception for those professionals in the industry some time ago. You need to climb first before you reach a level playing field.
Related: Nine Decisions When Clients Should Avoid Cheap Options