Building - motto about knowledge and stability

Top Planned Giving Myths and Truths Revealed

Building - motto about knowledge and stabilityWhat the heck are “planned gifts?”

For some reason, this term remains largely mysterious for many nonprofits. There’s a feeling planned giving is complicated. Not for the faint of heart or the small of budget.

This couldn’t be more wrong.

People wonder:

  • Are they deferred (i.e., you won’t receive them until after the donor dies)?
  • Are they outright (i.e., you’ll receive money now)?
  • Are they only for building an organizational endowment?
  • Are they just another term for major gifts?
  • Are they gifts where donors receive benefits like life income and tax avoidance?
  • Are they legacy gifts?

The Truth about “Planned Gifts”

They’re all of the above!

If there’s any overarching guideline, the truth is that planned gifts generally represent the largest gift a donor will make to you.

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fruit in basket

Where Are Our Nonprofit’s Legacy Donors?

fruit in basketLegacy gifts don’t fall from the sky.

Legacy donors aren’t delivered by storks.

You won’t find them hiding behind cabbage leaves.

You’ll mostly find them living in your donor database, volunteer roster, alumni mailing list, membership roll, client files and anyplace else folks connect with you and have a positive affiliation. An affiliation with you.

You see, the mere fact someone is wealthy does not make them a legacy giving prospect. Period. And the fact they’re wealthy and philanthropically inclined does not make them a legacy giving prospect for your charity.

The biggest indicator someone is a good legacy giving prospect for your organization is their affinity and loyalty. Generally this is demonstrated through affiliation (how they are connected to you) and behavior (what they do with you).

Of course, someone who simply shares the values your organization enacts can also be a viable legacy giving prospect. But they’re not likely to make a bequest or other type of legacy gift unless you first develop their affinity and loyalty — to your charity.  So let’s begin with the fruit already picked and in your donor basket.  We can look at the low-hanging fruit later. I do not recommend investing a lot of resources going after the fruit you’re hoping will just fall from the sky (though a little couldn’t hurt).

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Hope mural

How 13 Nonprofit Donors Yields a $1 Million Philanthropic Legacy

Hope mural13 happens to be my lucky number. I want it to be lucky for you too.

Today, I’m going to reveal to you how you can make this happen.

A recent survey of wills reported on by the Chronicle of Philanthropy reveals the average bequest by everyday donors is $78,630.

Some people will leave less; some people will leave more. What this survey reveals, however, is you only need 12 to 13 donors making a provision for your organization in their will to reap $1 million.

If a major gift for your organization is $1000 (or even 5000 or 10,000), I imagine this sounds off the charts to you. Guess what?

Legacy giving is off the charts!

In fact, bequest marketing produces the highest ROI (return on investment) of any fundraising activity.

The first step to making this happen for your organization is to encourage bequests. Actively.

Promote Charitable Bequests, or Else

If you don’t actively encourage charitable bequests, people are unlikely to make them.

Why? There are three primary reasons:

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Clouds and sky

Legacy Gifts Don’t Usually Fall From the Sky

If you’ve been around ten years or more, and have demonstrated you have staying power, it’s time to start thinking about promoting legacy giving. And not just a little. A lot.

Even during a pandemic. Why?

Because once you have a steady stream of legacy gifts maturing, you’ve secured your nonprofit’s future — in good times and bad. Not 100% of course. You’ll still need to continue with annual fundraising. But you’ll be confident in the knowledge that every year or so unanticipated income will flow into your nonprofit’s coffers, like a windfall from heaven. In fact, after a while you’ll even be able to conservatively budget for a certain amount of bequest income (based on your averages) each year.

Legacy gifts can be quite transformative for the financial trajectory of your nonprofit. Think about this for a minute. While not every bequest will be six or seven figures, it’s rare to see a two or three figure bequest. They’re all major gifts!

Except… legacy gifts won’t usually fall from the sky unless you seed the clouds.

So let’s take a look at how to do that.

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Inspiring chalk drawing

Should Your Nonprofit Legacy Program Be on Hold?

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…

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