Special Report: Two New Books Acknowledge Rosen

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We’re honored to report that two new scholarly books have acknowledged the assistance and helpful insights of Michael J. Rosen, CFRE.

American Charitable Bequest Demographics (1992-2012), by Russell James, JD, PhD of Texas Tech University, provides an extensive review of the changing nature of American charitable estate planning. The book presents over 50 charts and graphs in simple, visual fashion with each page containing one graph or chart, comments on the importance of the information, and details about the methodology behind the data.

With James’ book, you’ll learn about the estate planning trends that affect planned giving; you’ll discover how different demographic factors (i.e.: age, race, gender, family status, etc.) affect charitable estate planning; you’ll see the impact of giving and volunteering on charitable estate planning. You’ll also gain many other useful insights.

You can purchase a paperback version of James’ book at The Nonprofit Bookstore (powered by Amazon), Alternatively, thanks to the kindness of Russell James, readers of Michael Rosen Says…may download a FREE copy of the e-book version here, for a limited time.

Does Race Matter with Legacy Giving?

From time to time, someone will ask me if racial/ethnic differences exist when it comes to legacy giving. While phrased in various well-intentioned ways, the questions are usually asked in hushed tones. People fear being politically incorrect. They fear being perceived as bigoted.

Nevertheless, the question is a valid, important one when it comes to defining a priority prospect list.

Does race or ethnicity matter with legacy giving?

Fortunately, thanks to Texas Tech researcher Russell James, JD, PhD, we have a clear, though somewhat complex, answer based on concrete data about Americans 55 years of age and older.

In his newest book, American Charitable Bequest Demographics (1992-2012), James reveals that significant racial differences do exist when it comes to planned giving, at least on the surface. He found that in 2010, 6.5 percent of non-Hispanic Whites included a charitable estate recipient in their plans while only 1.8 percent of non-Hispanic Blacks and 1.7 percent of Hispanics did so.

The good news for us is that James’ inquiry did not stop there.

Looking below the surface, James found a critical reason for the disparity in charitable estate planning. Non-Hispanic Whites are simply far more likely to do estate planning with 63.9 percent doing so compared with just 23.4 percent of non-Hispanic Blacks and 19.6 of Hispanics.

To give us a better understanding of the impact of racial differences on legacy giving, James also looks at charitable estate planning among those with estate planning documents, a will or trust. Among non-Hispanic Whites, he finds that 10.2 percent have included a charitable gift. Among non-Hispanic Blacks, it is 7.7 percent with the figure among Hispanics at 8.3 percent.

James asserts that the data “shows that minorities are as likely as non-Hispanic Whites to include a charitable component in their [estate] plans once completed. [The analysis] suggests that the primary barrier to charitable planning among minorities is simply the lack of planning documents.”

Use of Wills and Trusts Down Sharply. Cause for Alarm?

The percentage of older Americans with a will or trust has plummeted in just a dozen years. If people do not have a will, they cannot include a charitable bequest commitment in it. So, should the latest findings from Texas Tech researcher Russell James, JD, PhD set off alarm bells for planned gift fundraisers?

In his newest book, American Charitable Bequest Demographics (1992-2012), James observes that 61.2 percent of those age 55 and over had a will or trust in 1998. By 2010, that figure had fallen to just 40.8 percent. For 2012, the projection is 40.0 percent.

There are two possible reasons for the sharp decline.

In many jurisdictions, individuals can use non-probate transfers such as transfer-on-death or pay-on-death designations. While traditionally used for financial accounts, such designations are increasingly available for automobiles and real estate. Designations can, in many cases, allow for the complete transfer of an estate without the use of either a trust or probate process.

The Power of Eye Contact: A Myth?

[Publisher’s Note: Michael J. Rosen, CFRE will be interviewed by CausePlanet in a free webinar about his award-winning book, Donor-Centered Planned Gift Marketing. Learn more and register for the October 17 program by clicking HERE. If you need a speaker or trainer, contact Rosen today.]

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We all have heard that it’s not just what you say, but how you say it that matters. Now, new research sheds some surprising light on the subject. 

In the past, researchers have proven that body language is important. We’ve been told to stand-up straight. Don’t slouch while sitting. Don’t point. Shake hands firmly. Look people straight in the eyes, assuming it’s culturally appropriate given the context.

However, a new article by Susan Adams, in Forbes, comes with a surprising headline: “The Power of Eye Contact — It’s a Myth.” The article begins:

Most of us think that when we want to make a point, we should look the other person in the eye. Spouses, bosses, car salesmen, politicians, all use a direct gaze when they’re trying to convince an audience of many or one that their position is the most valid. Now it turns out that they should probably cast their glance in a different direction.”

Adams continues:

In a new paper just published in the journal Psychological Science, Minson and Chen tested the proposition that eye contact can win over people who disagree with the speaker. In two different studies (conducted at the University of Freiburg where Chen was doing her post-doctoral work), their data show that people respond more favorably to opposing arguments when the speaker looks at an angle to the recipient or focuses his eyes on his counterpart’s mouth instead of his eyes.”

Based on the Forbes article and even the study abstract itself, one might believe that development professionals should minimize eye contact with prospective donors when meeting face-to-face, at least during the ask. After all, the researchers state:

These findings suggest that efforts at increasing eye contact may be counterproductive across a variety of persuasion contexts.”

In other words, if you’re trying to persuade someone to make a donation, increasing eye contact can actually hurt your effort, the research suggests.

The study is certainly provocative given that it runs counter to conventional wisdom and other studies on the subject of eye contact. However, should we take the study seriously? When in situations where we are trying to persuade someone, should we do as Adams suggests and just let our “eyes wander”?

Well, before you automatically accept the research findings, consider these issues:

● The research samples were small involving just 20 students in the first study and 42 in the second.

● The research sample was culturally biased as it only involved college students.

● The research sample was age biased as it only involved college-age students.

● The research only involved the actions of the message recipients, not the messenger. In other words, the researchers considered where the message recipients were looking and not where the messenger was looking.

● The researchers instructed the study participants on where they could look, thereby possibly introducing bias.

● The research involved test subjects “interacting” with videotaped presenters rather than live speakers.

For me to break from conventional wisdom normally requires compelling evidence. While the Minson and Chen research is interesting and provocative, I find it sufficiently problematic to warrant further research.

On the other hand, I won’t completely discount the research findings.

Survey Respondents Overwhelmingly Express Concern over Government Shutdown

The vast majority of nonprofit professionals (63 percent) responding to an unscientific Michael Rosen Says… survey say that they expect the US government partial shutdown will negatively affect their nonprofit organization or they are concerned it might.

The shutdown affects nonprofits in a variety of ways. Organizations that rely on government grants have seen those grant payments delayed or withheld. Organizations that do government contract work are seeing payments delayed. Organizations that assist individuals in need are seeing an increased demand for their services.

In addition to those negative effects, 28 percent of survey respondents expect the government’s partial shutdown will result in less philanthropic support this year.

Interestingly, 67 percent of survey respondents expect that the shutdown will hurt the nation’s economy. Because overall philanthropy closely correlates to the country’s Gross Domestic Product, at a rate of approximately two percent, we can expect overall philanthropy to be negatively affected if the shutdown slows the already weak economy.

New Pew Report Sheds Light on Tax Deductions and Philanthropy

[Publisher’s Note: Michael J. Rosen, CFRE will be interviewed by CausePlanet in a free webinar about his award-winning book, Donor-Centered Planned Gift Marketing. Learn more and register for the October 17 program by clicking HERE. If you need a speaker or trainer, contact Rosen today.]

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A new report issued by the Pew Charitable Trusts provides valuable insights into the effect that tax deductions and credits have on charitable giving. The report comes at a critical time as federal and state governments continue to look for additional sources of revenue including cuts to charitable-giving tax deductions.

The Pew report, written by Elaine S. Povich, looks at the impact of tinkering with tax write-offs for charitable giving in a number of states including Kansas, Michigan, Missouri, New York, North Carolina, and Vermont. The report nicely summarizes the impact of tax policy on philanthropy:

Tax incentives for charitable giving directly affect donations, particularly from high-income donors, according to Jon Bakija, an economics professor at Williams College. ‘Tax incentives for charitable donations in the US succeed in causing donations to increase, probably by about as much or more than they cost in terms of reduced tax revenue,’ he wrote in a paper published recently by the journal Social Research.”

Bakija went on to write:

This strengthens the case for the tax subsidies for donations.”

In an illuminating case study, the Pew report looks at what happened in Hawaii when the state government imposed a cap on the charitable giving tax deduction. According to Mallory Fujitani, of the Hawaii Department of Taxation, the state expected the move to generate about $12 million to the state treasury. Unfortunately, the move cost charities $50 million to $60 million in lost donations, according to Tim Delaney, President and CEO of the National Council of Nonprofits.

In other words, Hawaii found that for every new dollar of tax revenue it generated from the cap on the charitable giving deduction, charities lost five dollars!

David L. Thompson, Vice President of Public Policy at the National Council of Nonprofits, summarized the experience of the various states that have tinkered with the charitable giving deduction:

What we learned in the states is that the charitable deduction is not just a nice thing for taxpayers, it’s vital to the communities. All politicians from across the political spectrum have come to the same conclusion that we are hurting our communities by discouraging giving to charities.”

Given the crystal clear Pew report, the experiences of various states, and the findings of academic research studies, a number of important questions come to mind:

Special Report: Live Interview with Author of Donor-Centered Planned Gift Marketing

On Thursday, Oct. 17, 2013, at noon (EDT), Denise McMahan will interview me about my award-winning book, Donor-Centered Planned Gift Marketing. This is a free webinar presented by CausePlanet. To learn more and to register, click here.

McMahan, the Founder and Publisher of CausePlanet, will focus the interview on some of the book’s highlights, including:

• Identify who makes planned gifts and assess your organization’s potential for planned giving.
• Understand planned gift donors’ motivations and how these fuel the author’s recommended approaches.
• Explore how to educate and cultivate planned gift prospects and professional advisors.
• Engage in effective asks and stewardship practices.

During the lively discussion, I will also share new insights based on the latest research.

Do you want to start a planned giving program? Do you want to reinvigorate an existing planned giving program? Do you want to maximize your planned giving results? If you answered “Yes” to any of those questions, then register today for this free webinar about the book that earned the prestigious AFP/Skystone Partners Prize for Research in Fundraising and Philanthropy.

Here are some reviews of Donor-Centered Planned Gift Marketing:

Special Report: Doomsday?

On Oct. 1, 2013, the US federal government shutdown all non-essential operations. This is the first government shutdown in 17 years. It’s uncertain how long this shutdown will last. The failure by Democrats and Republicans in Washington to agree on a budget bill triggered the current shutdown.

At this point, we cannot really know how the impasse in Washington will affect the nonprofit sector, the nation, or the world. However, one thing is certain: The longer the shutdown continues, the greater the risks.

So that we all can get a better understanding of the situation, please take a moment to answer the following five poll questions: