Should Your Nonprofit Legacy Program Be on Hold?

Everything has its season

 

You may feel talking about mortality right now is a big ‘no-no.’

You’d be wrong.

I know some of you will argue with me. I’ve already seen one fundraising guru (who I generally admire greatly) say this is the only type of fundraising they’d not recommend right now. They called it ‘creepy.’

I understand the impulse to avoid this subject.

Especially now. Because it may feel insensitive. A bit like ambulance chasing.

Yet that’s not what legacy philanthropy is about. Not today. Not ever.

What’s Different in an Era of Pandemic?

Honestly, nothing. At least in this particular area of fundraising. Other stuff must be postponed or canceled, sure.

• You may have to put your events on hold.
• You may have to put planned spring and summer appeals on hold (assuming they were targeted for particular programs that don’t seem relevant or urgent at this point in time.)
• You may have to put targeted legacy giving mailings on hold.

You don’t have to stop promoting meaningful legacy giving.

Why?

Because right now we’re all questioning the meaning of life. And our individual lives in particular. What can we do, as individuals, to make a difference? Not just today, but for tomorrow?  What will our legacy be?

Whether we live or die, we’re all thinking about what life will be like on this planet moving forward.  Yes, we’re in a pandemic. It’s scary and uncomfortable as all get out. Yet, let’s face it. People are seldom comfortable confronting the notion of their own death. Nevertheless death is as natural as birth. It’s inevitable, sooner or later, for everyone. Of course, we all hope for later.

Promoting legacy giving is not about actively seeking out folks on the verge of death and asking them to sign their estate over to you.  That would, indeed, be crass. Again, legacy giving programs are not ambulance chasing! And, anyway, most of your supporters are not sick. Most will survive. Yet…

Right now everyone is thinking about this subject in terms of sooner. In a way that’s really unprecedented. As a result, more people than usual are in contact with their professional advisors.  They’re thinking about ‘just in case’ scenarios.

My home town San Francisco Chronicle had this headline in Sunday’s Paper: “Coronavirus forces health care workers to write will.” It reported on lawyers volunteering to do free Zoom sessions to help frontline medical workers with children under the age of 18 write up wills. They were overwhelmed by the response; since then, other lawyers have joined this effort. Workers noted:

— “We don’t have a will now, but we realize we need to make one. For other younger folks with small children who haven’t thought about their mortality up until now, maybe now’s the time to think about it.” 

— “We always knew we had to do this and now it feels like an emergency.”

Trusted philanthropy advisors agree:

Nathan Stelter, President of the Stelter Company, pointed out in a recent video that google search results are higher than they’ve ever been regarding will planning.

Cathy Sheffield, Chartered Advisor in Philanthropy, noted: “One thing is certain, donors have more time on their hands and are interested in our community returning to normal with little to no collateral damage.  Additionally, they are interested in formalizing their affairs.  While they may not want to discuss a planned gift, their interest in how to create a will is at an all- time high.  Recent news reports state that online searches for how to create a will has doubled or even tripled in the past month.“

Focus on Bequests, not ‘Planned Giving’

There’s a reason, even in ‘normal’ times, many people visit an attorney or financial advisor to review their will in a timely manner prior to taking an overseas trip. Or planning a risky adventure like skydiving. They wouldn’t otherwise think about their death (and, truly, simply getting into an automobile is probably more dangerous), but suddenly they’re thinking about the impact of their demise on those who they most care about.

This is a natural human response to fear. So people, including your donors, are going to be making or changing their wills right now. Everyone knows about wills. So they don’t need you to talk to them about fancy stuff like charitable trusts or annuities right now.

No matter what you do or don’t do, a lot of folks are going to be calling on their attorneys. Mostly they’re thinking about protecting their family and loved ones. But… some of them love your cause too! What happens when they get to the subject of legacy bequests and your donor goes online searching for charitable beneficiaries?

People may not know you’re set up to accept and manage bequests. And, trust me, it takes very little savvy to promote and accept these types of legacy gifts (see suggestions in ‘Final Thoughts and Actions,’ below). So make sure you’ve got this information on your website. And don’t bury it! Go to your website and pretend you want to leave a bequest to your organization. Can you figure out how to do so? How many clicks does it take to find what you’re looking for? If it’s a difficult process, now is a good time to make the experience more user-friendly.

“You Can’t Take it With You” Has Long Been a Truism

So… what’s a person to do with all the assets and income accumulated over a lifetime? Let’s answer this question first. Then I’ll share some non-yucky ways you can stay top of mind with your loyal supporters using messaging appropriate for the time we’re in.

There are 3 choices where a person can direct distribution of their hard-earned assets once they no longer need them personally; most choose to allocate their resources in this order:

1. Family and friends

First people take care of their family and close friends. Not surprisingly, most inheritances go first to spouses. In a 1988 survey of older individuals, John Laitner and F. Thomas Juster (1996) found that 45 percent of respondents with children considered leaving an estate or inheritance to be very or quite important.

2. Nonprofits

Next, most people would much prefer to help a beloved charity (or charities) where they can have some control over the purpose for which their money is used. Charitable bequests comprise roughly 14 percent of nonspousal bequests.

3. The government

Few people are happy leaving their money for the government to spend – because trust in how the government allocates its resources has always been pretty low. Today it’s extremely low.

The extent to which a donor will be forced to make these choices depends upon the tax laws in force at the time of their death.

When folks used to have to pay estate taxes on estates in excess of $1 million, many donors had to choose at least two of these options. There was no way they could leave everything to their heirs. Either the government would take a percentage of their estate or they could leave their estate to charity (thus avoiding all income, capital gains and estate taxes on these donated assets). That was a terrific selling point for charitable bequest programs.

Today most people can leave everything to their heirs, if they so choose.  Just last year the Trump tax law doubled the federal estate tax exemption amount to a base level of $10 million—through 2025 This year the IRS announced the estate and gift tax exemption is $11.58 million per individual $23.16 million for a married couple.

Not everyone wants to leave everything to their heirs – even if they can.

Some of your donors have more assets than they or their children need. I’ve worked with plenty of wealthy philanthropists who don’t want to leave too much to their children, because they want them to become confident, productive, contributing members of society. If someone has a $50 million estate, for example, they may leave $15 million to each of their two kids and $20 million to charity.

I’ve also worked with less wealthy donors who still want to leave a legacy to a beloved charity they’ve supported throughout their lifetimes. “My son and daughter won’t miss an extra $10,000 when I die, and this is something I’d like to do – both to communicate my ethics to my heirs and to leave the community improved by my philanthropy.”

How to Help Donors to Assure Values Live On

Know by offering a legacy opportunity you’re doing something good.

In fact, promoting bequest giving may be the ultimate way to help people assure their values live on. It’s no different than what you do with annual or major gift fundraising. Philanthropy facilitation is all about what fundraising guru Hank Rosso called “teaching people the gentle joy of giving.”

Put yourself in your donors’ shoes.

Whatever is going on in the world right now, most people want to feel they made a mark in this world. They mattered. Hopefully they’ll continue making their mark for a long time to come. Promoting a legacy gift to your charity is not signing a donor’s death warrant or showing you don’t care about their health and longevity.

Frame the discussion in a positive light.

Message donors about the impact they would like to make, from preventing injustice, protecting free speech, finding a cure, saving the redwoods, strengthening the arts, to supporting theirr local church, mosque or synagogue. Endeavor to trigger happy memories, reminding donors of traditions they want to preserve. This transforms a potentially miserable thought process into a source of joy and hope.

Make donors who leave a legacy feel super good!

Whenever a donor informed me they’d made provision for our charity in their estate plan, I always told them I hoped it would be a long, long time before that gift came to fruition.  In fact, I reassured them this would be the case (the fact planned gift donors outlive other donors is often a tongue-in-cheek (but not untrue) subject for discussion in fundraising circles; this probably has to do with other demographic factors, but it’s comforting to donors nonetheless. Everyone wants a bit of a ‘lucky charm.’).

Final Thoughts and Action Steps

1. You are not a ghoul.

The concept of creating a will is very much on people’s minds right now.  If people are looking for a charity to assure their values live on, you want to be able to promise them you’re a suitable beneficiary. Because… your values match their values. Honestly, people today are thinking a lot about their values. They’re noticing what they thought mattered to them isn’t what really matters. People helping… caring… empathizing… soothing… teaching… supporting…thanking… sharing… understanding… noticing… listening… speaking truth… advocating… these are among the values rising to the surface right now. And these are the values the social sector upholds. Now is the time people just may want to help assure the values your nonprofit enacts on a daily basis live on.

2. If you’ve promoted bequest giving in the past, don’t stop.

Review what you have, and make sure your language and images are sensitive to the times we’re in. You may want to avoid sending a targeted mailing asking donors to consider a bequest, but do continue with any passive strategies (e.g., checkboxes on your remit envelopes and donation landing pages; information on your website; stories about the impact of previous bequests in your e-newsletter; legacy donor testimonials sharing why they left a bequest, etc.).

3. If you’ve not promoted bequest giving in the past, add information to your website indicating how supporters can leave a legacy.

Getting started is easy and not resource-intensive. Begin just by putting it out there in the universe with simple messaging. Honestly, you don’t need to set up anything special. For example:

• On your website: “Where there’s a will there’s a way. Consider leaving a legacy to memorialize your important values.”
• On your donation landing page: “What will your legacy be?” Then include suggested language (here’s an example from Alex’s Lemonade Stand).
• On your remit envelope: “I have made provision in my will to support this mission!”
• On your outer mailing envelopes or email signature: “Please remember XYZ charity in your will.”
• In the form of a ‘legacy giving society.’ Human beings are joiners. The like being part of a ‘club’ of like-minded people – even if it only means you recognize them on a donor honor roll, send them a certificate or share a special newsletter with them. So what you can to show legacy donors are much you honor them.

4. Don’t worry if you don’t have wealthy donors.

Legacy gifts come in all sizes. And little gifts add up. Plus, not uncommonly, bequests will come from supporters who never made a lifetime donation. Per a recent survey of wills reported on by the Chronicle of Philanthropy you only need 12 to 13 donors making a provision for your organization in their will to reap $1 million. Some people leave less; some more. However, the first step is to encourage bequests.

5. Practice gratitude abundantly; you’ll find it will come back to you.

When you’re notified a donor has made provision for your charity in their will, get in touch with them and thank them. Whether you’re informed by the donor, a lawyer, or a family member, express gratitude. And take the opportunity to find out as much information as you can, including what inspired the gift (maybe you’ll even be able to write a story about them!). Stay in touch and steward them as you would any donor. I’ve actually found once donors make a legacy gift, their annual giving increases as well. And Giving USA data supports this, revealing 7% of planned giving donors say their annual gifts to the organizations they support increased after making a planned gift. Why? They’ve essentially ‘adopted’ you as a family member!

TRUE STORY: I worked as development director with a comprehensive human services agency in San Francisco during the AIDS epidemic. We opened a targeted AIDS Outreach program. Sometimes people were ill. Or their partners were ill. We didn’t get aggressive about asking people to leave their assets to us. That, indeed, would have been inappropriate. We did ask how we could be helpful. What was most important to them right now, and how could we facilitate that? Most of the work, frankly, was done through caseworkers and direct service volunteers, not development staff. We delivered meals. Set up home care. Brought in therapy dogs to visit. Arranged for hospice care if needed. And, sometimes, if they brought up the subject of how they would like to leave a legacy to help other people, we talked with them about that. I met with the caseworkers and let them know the options available. Most gifts were simple bequests that could be added to existing or new wills or trusts – because often these folks were in the process of meeting with their advisors.  Sometimes they contacted their financial institution and asked for a form to make our agency a beneficiary of their account. Sometimes, if they wanted to set up a lasting endowed memorial fund, I worked with them to get this set up. We were able to thank them while they were living, and assure them their legacy would live on. And, in fact, partners often continued to contribute to these funds. This meant a lot to everyone.

If you have thoughts, or stories, to share, please do so in the ‘comments’ below.