In my last article, It’s Fundraising Malpractice Not to Build Future Reserves, I introduced the subject of having both an organizational checking and savings account so you don’t risk going belly up when people rely on you. I talked about building a case for endowment and bringing your board on board. Then I tried to…Details
Just like it’s prudent for individuals to have both a checking and savings account, it’s prudent for nonprofits to have both operating funds and endowment reserves.
Living paycheck to paycheck is less than ideal, especially when constituents rely on you for services that really matter. Seriously ask yourself:
- Are we potentially one lost grant away from having to close our doors? Funders change priorities all the time.
- Would losing one major donor gift mean we might not make payroll? People move. People die. People change their loyalties and areas of interest.
- If we don’t do a big special event every year, will we need to cut programs? This happened to many nonprofits during the pandemic.
- Am I regularly losing sleep over not being able to pay rent? Without insurance against funding cutbacks, your focus is always on survival rather than effective planning and management.
If your answer to any of these questions is affirmative, you’re living on quicksand. When you’re not actively safeguarding your future, you’re robbing your community of precious resources.
Does this sound like a prudent, caring way for your nonprofit to behave?
Not if you see yourself as a community.
A Community Cares for its Members
Without caring, you’re just a zip code or a building, not a community.
Make this the year you demonstrate your caring by planting seeds for future harvests.
You can’t care for people, animals, places, things or values without nourishment and fuel. As a recipient of philanthropy, it’s your job to steward the resources others give so you’ll be there for the community when they need you most.
- If you don’t plan ahead to survive and thrive…
- If you don’t plan for growth that may be necessary as new needs arise…
- If you allow vital resources to run out…
Your community fails too.Details
There’s a lot of potential legacy giving out there in the universe. Per Giving USA 2022, giving by bequest was an estimated $46 billion, (an increase of $5 billion from just two years previous). What are you doing to assure some of it will flow to your cause?
First, Identify Your Audience for Legacy Gifts
I cover this subject in depth in Where Are Our Nonprofit’s Legacy Donors? Contrary to the way most nonprofits behave, legacy gifts don’t simply fall from the sky. They’re not delivered by storks carrying baskets filled with wills, trusts and beneficiary designations. You need to do something proactive.
You can’t simply rest on your reputation, however solid it may be. You could be raising tons and tons of money annually, and it won’t necessarily translate to bequests. It’s not because your donors aren’t the will-writing kind. That may be true for some of them, but there are other simple ways to leave a legacy accessible to all. Donor willingness is not the problem.
Key: Your Willingness to Prioritize Building a Legacy Giving Program
No charity succeeds simply waiting by the phone for folks to call. You’ll receive a bequest or two, perhaps. But nowhere near what you could receive if you took the bull by the horns and created a program that speaks to why people make legacy gifts.
There are two main reasons: (1) they’re asked, and (2) it feels meaningful to do so. So, given this, what do you incorporate into your program? What if I told you there’s a way to take charge of your own destiny, as you simultaneously help donors take charge of theirs?
STEP #1: Figure out a strategy to get folks thinking of you as a recipient of their philanthropic largess after death. There are elements to include in a full-fledged legacy giving program, and I’ve written about that plenty (e.g., see here and here).
STEP # 2: Help donors connect their giving to their personal identity and meaning. People may believe you’re awesome. But when it comes to distributing the hard-earned income accrued over a lifetime, they just don’t think of you that way. As an extension of their family, deepest values and essential identity. This is where many nonprofits fall down on the job, and it’s what I want to discuss today.Details
Do you want to risk not receiving generous gifts you could have otherwise received, just because you failed to go the extra mile to share relevant, useful and even critical information? Or because you just did the most basic things, failing to do what would have made your communications really stand out?
The Genuine Job of the Philanthropy Facilitator
Your job as a philanthropy facilitator is to do everything in your power to make giving to you as easy, joyful and rewarding as possible.
Doing everything meansDetails
Yet they’re generally undervalued in this regard.
And it’s not just monthly donors who are undervalued.
It’s legacy giving in general.
How robust is your legacy giving program?
Legacy giving is largely misunderstood in the nonprofit world. Too many organizations think it’s not for them. Why?
Do any of these statements sound like something you’ve felt or heard from others within your organization?
- Legacy giving is complicated and overwhelming.
- Legacy giving requires significant legal and financial expertise.
- Legacy giving requires offering “vehicles” we’re not equipped to offer.
These are myths.
Really, all you need is expertise about your mission and the values your organization enacts.
You are a philanthropy facilitator, not an attorney or financial advisor.
As a philanthropy facilitator, it’s part of your job to help loyal supporters make their most passionate, heartfelt gifts. This enables them to enact their values, and to achieve a bit of immortality.
Here’s What’s TrueDetails
Money left on the table is one of my pet peeves. It’s really beyond a peeve.
I can’t stand it when organizations could be serving more people, or doing so more effectively, but they don’t because they’re too smug (“what we’re doing now works just fine, and don’t try to tell me otherwise”) … self-reportedly “too stressed” … or simply not open to the idea of trying out some new strategies.
This “resting on one’s laurels” modus operandi leads to status quo organizations that fail to evolve to meet the moment. They get stuck in the past and, too often, begin to wither and die. Or they become what I call a “boutique charity” appealing to a niche group of insiders, content with the status quo.
That’s “nice,” but if you’re dedicated to solving pressing societal problems, meeting insistent human needs, and creating transformational personal and societal change, you’ll need to connect with donors on a more direct, visceral level.
How to Stop Leaving Money on Your Table
Your best donors have linkage, interest and ability (LIA). Begin with those already linked to you by virtue of having made a previous donation, been a loyal volunteer, served on your staff or board, or been a repeat purchase of services or products. In other words, they’re hiding in plain sight in your database.
Consider how you might learn more about these folks to better connect with them and make the best use of limited resources. You can do this in one of two ways:
- Donor Analytics: Find out how wealthy they are (ability)
- Supporter Connection Survey: Find out what they care about most (interest)
It’s funny, but too many nonprofits start with the former and often completely ignore the latter. It’s a way to go (and I confess I’ve been there), but is it the best way? I no longer think so – which is why I’m writing this article.Details
There’s a lot of potential legacy giving out there in the universe. Per Giving USA, giving by bequest was an estimated $41.19 billion in 2020, and grew 10.3% from 2019 (an increase of 9.0%, adjusted for inflation). What are you doing to assure some of it will flow to your cause? First you have to identify…Details
What 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.
- 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.Details
Legacy 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).Details
13 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!
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:Details