There are seven things you should know about older Americans that just might surprise you and help you with your fundraising efforts. U.S. Trust, Bank of America Private Wealth Management published the report U.S. Trust Insights on Wealth and Worth-TMbased on its 2011 survey of Americans with an average age of 61 and investable assets of at least $3 million.
There are now approximately 5.6 million households in the U.S. with more than $1 million in investable assets, including 4.8 million with $1 million to $4.99 million and 782,000 households with more than $5 million in investable assets, of which approximately 182,000 have greater than $10 million in investable assets.
Here’s what you need to know:
Of those with net worth of $3 million or more, 40 percent do not consider themselves “rich.” They may consider themselves “comfortable” or “financially secure,” but not “rich.” So, when speaking with those who you may consider to be wealthy, consider that they may not define themselves in the same way. So, be sure to speak their language. For example, many people think that a “bequest” is something that only rich people do and, therefore, there’s a good chance that they will not think this is an option for them since they’re not rich. When talking about a charitable bequest commitment, you might be far better off keeping it simple by talking about “supporting your favorite charity through your will.”
Older, wealthy Americans believe the most important use of wealth is to ensure financial security for themselves and their families. So, when speaking with these individuals, show them how philanthropic planning can benefit them and their families. For example, a Charitable Gift Annuity can provide them with an income for life. Or, a gift of appreciated stock rather than cash can help them avoid capital-gains tax. Also, be sure that donor prospects understand that you’re not seeking all or even a large portion of their wealth. Let them know that you understand the old adage that charity begins at home. By being donor-centered, you’ll have a happier prospect who will be much more willing to support your organization.
Among older, wealthy Americans, 40 percent say they do not have an estate plan that is comprehensive. There are many reasons for this. They may simply not have gotten around to it. They may not know what their options are. They may not know what the elements are of a comprehensive estate plan. They may not know to whom to turn for assistance. This presents you with an opportunity to be of service. You can educate these people and guide them to get their estate plan in order. In the process, you’ll have the opportunity to discuss how philanthropic planning can be an effective, desirable part of estate planning. And, you will earn the gratitude of those you assist.
Only about one-third (34 percent) of parents agree strongly that their children will be able to handle the inheritance they plan to leave them. This is an opportunity for you to show parents how they can structure their estates to confidently take care of their children while also benefiting their favorite charity. Again, by being of service to prospective donors, you can ultimately help your nonprofit organization.
Interestingly, 52 percent of older, well-off Americans have not fully disclosed their wealth with their children. As a development professional, you can help encourage or even facilitate a family conversation about wealth provided it is something the prospective donor is interested in. And, involving the family in philanthropic decisions can be enormously rewarding for parents and children alike. Handled most effectively, you might even be able to secure another generation of supporters for your organization.
It is important to know that 19 percent of older, wealthy Americans who were surveyed do not have children. Nonprofit organizations are far more likely to secure a planned gift from an individual if she has no children. This represents an enormous opportunity for securing donations in general, and planned gifts in particular. Just remember, that while a prospective donor might not have children to plan for, she will be concerned about her own financial security and that of her spouse.
Among older, wealthy Americans, 44 percent have never discussed their philanthropic aspirations with their financial advisor. Again, this is an opportunity to be of service to the prospective donor. By encouraging the prospect to involve his financial advisor in a discussion about philanthropy, you can get a seat at the table and work with the financial advisor to help the donor to fulfill his philanthropic aspirations in an effective way. If you talk with the donor about his giving without suggesting he involve his financial advisor, you may find that the financial advisor eventually may toss a monkey wrench into the philanthropic plan. So, it’s best to suggest involving the financial advisor. If the donor does not wish to involve his advisor, at least he will know you have an interest in protecting his interest.
The more you know about your prospective donors, the more you can determine how you can be of service and, in the process, you’ll build a stronger relationship that can ultimately generate significant current and deferred gifts. One way to better understand your prospects is to read the U.S. Trust Insights on Wealth and Worth-TM report which you can download by clicking on the title. In addition, my book Donor-Centered Planned Gift Marketing contains additional demographic insights as well as a detailed review of what motivates donors and what de-motivates them.
That’s what Michael Rosen says… What do you say?