3 Common Myths About Planned Giving

Planned Giving will hurt our Annual Fund. My experience is that planned giving does not compete with annual, current, or pledged gifts. It actually augments annual giving. Often, planned giving donors will increase their annual giving, because they know that the benefit of their planned gift is something they’ll never see. So they would like to make current life gifts to the organization that they care so much about and see the fruit of their investment while they are still alive.

We also find that planned gift donors tend to make larger capital campaign and major gift investments. The average unsolicited planned gift is around $35,000 in the United States. Solicited planned gift can be as much as five or ten times that. We find that planned gift donors will make larger current life major and capital campaign gifts than they would have made if they were not planned gift donors.

Organizations need not worry that they’re going to lose money today for the benefit of getting money tomorrow.

Planned Giving is too complicated. It doesn’t have to be. Many non-profits worry that planned giving is just too complicated for their staff to handle. Nonprofits can fall into the trap of believing that planned giving is only the domain of major universities and hospitals, and that you have to have a law degree or a similar credential to solicit planned gifts. That is just not true. Most planned giving is actually quite simple.

There are a few products that are very complex, but product knowledge isn’t the primary responsibility of the organization that is soliciting the planned gift. Our primary responsibility in fundraising is stewardship of our relationship with our donor. When we steward that relationship well, we know what our donor’s giving needs are, and our donor knows what our growth aspirations are in our nonprofit. Then we are able to offer our donor ways of making gifts that improve the outcomes that we both care about.

A gift solicitor doesn’t need to know how to write a will or how to amend a will using a codicil. A gift solicitor is responsible for knowing that intends to leave a legacy through their will. We offer the opportunity of helping them find someone who can turn their charitable intent into a written plan.

If you simply focus on the three basic planned giving types: wills and bequests, life insurance, and charitable gift annuities you will be able to discuss over 80% of planned gifts that you will ever encounter. When a donor happens to mention that they might like to make a gift using some kind of charitable remainder or charitable lead trust, you will be able to quickly refer to the attorney that takes care of your nonprofit’s legal matters or a volunteer attorney on your board or planned giving committee who will be able to help carry the ball with you from there.

I don’t want lack of legal or accounting knowledge to prevent nonprofits from beginning healthy conversations with our donors about making planned gifts, and then feeling confident enough to loop in professionals when the time is right to help meet the needs of donors.

Planned giving takes too much time. The creation of whole fundraising departments dedicated to planned giving gives the impression that you must have full time staff to be successful in this area of philanthropy. While that can help, I know organizations that spend a solid thirty minutes a week on planned giving and do quite well.

When planned giving is done well, you are engaging with donors you already know and who have already made significant investments in your organization. The next step in the process is asking them to make a legacy investment in your mission.

Once you run a query in your database of potential donors, you can spend 30 minutes every week having quality conversations with donors you already have! It is an amazing step in the relationship you have with your donor.

Organizations that do mass solicitation of planned gifts with prospects who have never been donors can spend (and waste) a great deal of time cultivating potential donors who have little to no interest in making a planned gift.

By focusing on donors who have already invested in you, precious time and saved, relationships are deepened, and transformation gifts are made. All of this is possible with just 30 minutes every week.

Rob Henson is a Certified Fund Raising Executive with 15 years of experience. He has managed over 80 capital campaigns and worked with 200 global clients. He blogs each week at www.hensongroupllc.com