Planned Giving – An Important Part of Fundraising
Did you know that only 5% of the nation’s wealth is in cash? If you only ask for cash donations (and too many organizations do), you’ve left a lot of money on the table. If you want your organization to be around in 10 years, you better make “planned giving fundraising” part of your fundraising efforts. This is true for churches and faith-based organizations, too.
Planned Giving Fundraising
What is planned giving? It is the process of encouraging gifts of assets, such as stocks, retirement plans, and real estate. People can give more out of their assets than they can out of current cash flow. Planned gifts can be 10 times or more than the amount of an annual gift.
Why don’t more organizations have planned giving programs? There are two common objections.
First: it will drain money from annual gifts. Organizations that have planned giving programs report that just the opposite is the case. If somebody makes a planned gift, which is for the long term, they will continue and sometimes even increase their annual giving. Why would somebody give to the long term and stop giving to your organization’s shorter-term needs?
Second: organizations fear that it is too complicated. While time and space don’t allow us to give details on each type of gift, the fact is most planned giving is not complicated. Most planned gifts come from estates, but an increasing number of gifts are coming through beneficiary-type gifts, such as transfers on death and retirement plans.
How do you start a planned giving program? Here is an overview of the steps:
1. Educate staff and Board members about the various types of planned gifts and their benefits.
2. Prepare and get Board approval for gift acceptance policies. The policy will outline the types of gifts you will accept or not, and the procedures for accepting gifts. You may be tempted to take a template off the Internet, but resist. One size does not fit all.
3. Start marketing various types of planned gifts through your website and publications. Remember that while donors want to know the tax consequences of a gift, taxes don’t drive a gift. People give to support your mission.
If you are interested in starting a planned giving program please give us a call. We have experience educating Boards, assisting with gift acceptance policies, and assisting with any technical questions about planned gifts.