A Donor Offers You $5,000. Now What?

Congratulations! You’ve done everything right, so far. As a result, a prospect has offered to write a $5,000 check to your nonprofit organization. She only has one question: “Who should I make the check out to?”

So, what should you do next?:

A. Let loose with an enthusiastic, sincere, “Whoohoo!”

B. Thank the donor and tell her the proper name of the organization for the check.

C. Tell the donor the information is on your organization’s website.

D. Thank the donor, tell her the proper name of the organization for the check, and then say, “And, let me just ask, if I may, do you have any appreciated stock?”

Check SigningIf you’re like most development professionals, you probably answered “B.”

While that’s not exactly a wrong answer, there is a better one that will be more helpful for the donor and for your charity: “D.”

Sadly, many development professionals wrongfully assume that all donors of means know, at least, the basics of financial planning and tax avoidance. However, that’s simply not the case.

Sometime ago, I served on the board of a nonprofit organization. At one of the charity’s events that I attended, a modest donor came over to me and expressed an interest in donating $5,000. She simply needed to know the organization’s official name so she could put it on the check.

As in the above scenario, after thanking her and providing the information, I asked if she had any appreciated stock.

Puzzled by my question, she replied, “Yes, I do. Why do you ask?”

I then explained that if she contributed appreciated stock valued at $5,000, rather than cash, she could avoid the capital gains tax, thereby resulting in a savings.

Surprised, the donor responded, “I can avoid giving my money to the government, by giving the foundation stock? That’s a great idea! And, since I really don’t need the money, why don’t I just increase my gift by the amount I’ll save in taxes?” After consulting her accountant, she did exactly that.

However, her generosity did not end there. Moved by the work of the foundation and the good advice she had received that allowed her to avoid some capital gains tax, she consulted with her family and her advisors. She then contributed over $15,000 to create a namesake scholarship fund.

By asking a simple question, I let this donor know that I was looking out for her. That would still have been the case even if she already knew about the advantage of donating appreciated securities instead of cash.

If I had not asked the question, the organization would have received a $5,000 check. And, the story may have ended there.

When you are donor-centered, you earn more trust than would otherwise be possible.

If you handle a $5,000 gift properly, if you look out for the interest of the donor, she will likely have greater confidence in you and your organization. The more trust she has in the organization, the more likely it is that she will give more and the more likely it is that she will make a planned gift.

Being donor-centered is good for the donor, and it’s good for the organization.

Oh, once you’re back at the office, let out that “whoohoo” and high-five the first person you see.

That’s what Michael Rosen says… What do you say?


[Publisher’s Note: For more donor-centered planned giving tips, checkout the book Donor-Centered Planned Gift Marketing. The book earned the AFP-Skystone Partners Prize for Research in Fundraising and Philanthropy and a spot on the official CFRE International Resource Reading List.]

10 Comments to “A Donor Offers You $5,000. Now What?”

  1. It’s all about the assets!

  2. Michael,
    I have to admit that I would have been one who answered B, but after reading today’s post, I will think more about about answering with a D.

    • Richard, thank you for commenting. I’m glad to know you found this post meaningful. I frequently tell development folks that they have to answer this question: “What’s in it for the donor or prospect?” This question has to be asked at every point of contact, whether a direct mail appeal, a cultivation visit, a face-to-face ask, a newsletter mailing, etc. The more value we can provide the donor or prospect, the more likely s/he will be to give and give generously. And, the more loyal that donor will be to the organization.

  3. Michael, that’s a good piece of advice. It’s an example of how a development person can bring value to a donor and to their organization. Everyone wins!

  4. I love your comment to think about what’s in it for the donor! Taking their perspective is a great thought. We look for this in grant requests, but for individual donors it never occurred to me that they would also have an interest in some return or value for their investment into our nonprofit.

    • Kathy, thank you for your kind comment and for letting me know that my post resonated with you. The good news is that the “return” or “value” that donors want is usually not a coffee mug or t-shirt, though those are sometimes appreciated, too. What donors really want is to know that their gift will have a positive impact. You can read more about this in my post “5 Tips for Giving Donors What They Really Want.”

      Here’s an example from my book, Donor-Centered Planned Gift Marketing:

      “During a conversation about estate planning, an elderly, childless woman was asked by her nephew if she had included any charities in her will. She asked, ‘Why would anyone ever give money to a charity after they’re dead?’ Knowing the answer, he asked, ‘Do you support any charities now?’ The aunt replied with a list of organizations she supported including an animal welfare organization. When the nephew probed, the aunt said, ‘I give them money because I want to help protect the unwanted cats and dogs.’ The nephew then asked, ‘Okay, I understand. But tell me, who is going to take care of the little kittens and puppies when you’re no longer here to write out the checks to help them?’ The aunt’s eyes grew wide. In that moment, the nephew may have reduced or eliminated his inheritance, but many kittens and puppies will likely be better off as his aunt realized she could endow her annual gift and continue to make a difference long into the future.”

  5. Michael,

    Great advice for the donor, something that they can appreciate and through that advice they develop a deeper relationship with you as the “asker.” I have done what you have suggested with prospective donors as well as ask if they may have a DAF and, in a few cases, received a personal check for the organization, transfer of stock, and a gift through their DAF to carry out their charitable wish.


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