Archive for ‘Planned Giving’

January 19, 2018

Charitable Giving Threatened by Drop In Volunteerism

On Monday, the USA celebrated Martin Luther King, Jr. Day as a national day of service. From April 15 to 21, the nation will mark National Volunteer Week. Clearly, Americans value volunteerism.

Unfortunately, the volunteerism rate has been steadily declining for years. This trend has disturbing implications for philanthropy.

In 2003, the US Bureau of Labor Statistics reported that 28.8 percent of Americans volunteered. By 2015, that rate had steadily fallen to 24.9 percent. This is a huge problem for the nonprofit sector for a number of reasons:

Volunteers Provide a Valuable Resource. Volunteers do a great deal of work that might not be done otherwise. 62.6 million Americans volunteered 7.8 billion hours. Independent Sector reports that a volunteer hour is worth $24.14, over $180 billion of total estimated value. Sadly, with volunteerism on the decline, charities are forced to provide fewer services or incur greater labor costs.

Volunteers Serve as Ambassadors. In addition to being a valuable labor resource, volunteers are also fantastic ambassadors for an organization. The typical volunteer serves only one or two organizations, according to the US Bureau of Labor Statistics. When volunteers share their experiences, they also talk with friends, family, and professional colleagues about your organization and its mission. This could lead to additional volunteer and philanthropic support. With a drop in volunteerism, there are now fewer ambassadors for charities, which will inevitably lead to less future support.

Volunteers are More Likely to Donate. Volunteers are twice as likely as non-volunteers to make a charitable contribution, according to the Corporation for National and Community Service. Even planned giving is affected by volunteerism. As I’ve reported previously, researcher Russell James, JD, PhD, CFP states in his book, American Charitable Bequest Demographics (1992-2012):

Among those with [estate] planning documents, those who both volunteer and give ($500+) are dramatically more likely to plan a charitable estate gift than those who only volunteer or only give ($500+). Those who only volunteer, plan charitable estate gifts at approximately the same rate as those who only give.”

Those who only volunteer or only donate ($500+) are more than twice as likely to make a legacy gift than those who do neither. [For a free electronic copy of James’ book, subscribe to this blog site in the right-hand column. You’ll receive an email confirmation of your subscription that will contain a link to the book.]

With a decline in volunteerism, we can expect fewer people to make current and planned gifts. This is already happening according to an analysis by The Chronicle of Philanthropy.

There are many likely reasons for the decline in volunteerism including:

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January 12, 2018

Hang-on to the Holiday Spirit with FREE Gifts and Resources to Raise More Money!

For most of us, whether we observe Hanukkah, Christmas, or just the New Year, the holiday season is an uplifting time full of joy. However, the same cannot always be said of the post-holiday period, according to Linda Walter, LCSW. Her article in Psychology Today cites many reasons for the post-holiday blahs, for some, even depression.

As an antidote for the after-holiday letdown, I want to share several free resources with you that just might help you keep the holiday spirit going while also helping you raise more money in 2018.

The Donor-Advised Fund Widget. For starters, let me tell you about the Donor-Advised Fund Widget created and offered free-of-charge by the generous folks at MarketSmart. This useful, free gift will help you continue to celebrate the season and raise more money for your nonprofit organization.

When it comes to fundraising, a general rule is: Make it easy for people to give your organization money. You probably already do this in a number of ways. For example, your organization probably allows donors to place gifts on their credit card, mail a check in a business reply envelope you supply, give online, or contribute when they buy products (e.g., Amazon Smile).

So, why not also make it easy for someone to recommend a donation from his or her DAF account?

Rather than viewing DAFs as enemies that divert vitally needed funds away from charities, nonprofit organizations should view DAFs as a great fundraising opportunity. Unfortunately, the problem is that nonprofits have not made it easy for people to donate from their DAF accounts…until now.

Greg Warner, Founder and CEO of MarketSmart, says:

Amazon is successful primarily because they make it easy to buy stuff. Similarly, if nonprofits just made it easy to transfer DAF money, the bottleneck would get un-clogged. But no one was stepping up. So I did!”

The DAF Widget goes on your organization’s website. Your donors with DAF accounts then can easily find their account management company from a comprehensive list of over 800 service providers. Then, they simply click to go directly to their DAF management company’s website where they can enter the relevant information to make a donation recommendation for your organization. To see the widget live, visit the Navy-Marine Corps Relief Society website by clicking here.

DAFs are an increasingly valuable source of donations for charities. Consider the following market-wide insights from The National Philanthropic Trust 2017 Donor-Advised Fund Report:

  2012 2016
Number of DAF Accounts 204,704 284,965
Total Assets in DAF Accounts $44.71 billion $85,15 billion
Grants from DAF Accounts $8.5 billion $15.75 billion
Ave. DAF Asset Size $218,413 $298,809

To put the above figures into context, non-corporate private foundations gave $45.15 billion to charities in 2016. By contrast, donations made from DAFs totaled $15.75 billion that same year, equating to roughly one-third (34.8 percent) of the estimated amount granted by non-corporate private foundations.

In other words, DAF donations represent a significant and growing source of gifts for nonprofit organizations. However, to get your share, you need to make it easy for people to recommend donations from their DAF accounts. That’s why MarketSmart created the free DAF Widget.

You can learn more about the DAF Widget and claim yours by clicking here.

There is just one catch, if you want to call it that. The DAF Widget is in its Beta Edition. So, MarketSmart is looking for feedback, either directly or through comments below. Then, Greg promises to invest more time and money to make the DAF Widget even better. So, if you use the DAF Widget, please let us know how you think it could be made easier to use and more effective.

Here are seven additional resources for you to help get 2018 off to a great start:

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December 8, 2017

5 Mistakes that Could Cost You Year-End Donations

As year-end approaches, you are probably working feverishly to raise as much money as possible for your nonprofit organization. Unfortunately, you might be making some mistakes that could cost your charity enormous sums of potential donations.

Here are just five common ways you might unknowingly short-change your organization at this special time of year:

1.  Appeals by the Numbers.

Many of the year-end appeals that I receive focus on numbers. Often, the number is “31,” as in December 31. Other numbers tout the volume of people served or the amount of a challenge grant. As I wrote last week, numbers can tell part of an organization’s story; however, numbers can’t tell the full story.

For the most effective appeals, you will want to engage hearts and minds. While some numbers can be meaningful, telling an individual story makes your nonprofit’s work more relatable and easier to understand. Individual stories are also far more likely to engender an emotional response.

The Wounded Warrior Project is a great example of what I mean. The organization could tell us how many veterans suffer from PTSD and medical issues. The charity could simply tell us how many veterans they serve each year. Instead, the Wounded Warrior Project tells the story of a single veteran. The organization’s television appeals are mini-movies that tell us of a veteran’s war experience, the problem he or she came home with, and how the Wounded Warrior Project is improving the veteran’s life. You can watch one of the organization’s television spots by clicking here.

2.  Not Asking for Gifts of Stock and Other Planned Gifts.

If you want to maximize year-end giving, you must seek planned gifts. Planned giving allows donors to make more gifts and larger gifts than they might otherwise be able to do simply from their checkbook. This is great news for your charity. Even better news is that not all planned gifts are deferred gifts. Here are some types of planned gifts that will result in immediate cash for your organization:

Gifts of Stock. With the stock market in record territory, many Americans own appreciated securities. By contributing stock shares to your organization, a donor can make a generous gift, realize a charitable gift deduction, and avoid capital gains tax.

Gifts of Appreciated Property. As with stock, many individuals own appreciated real December 31st by TransGriot via Flickrestate, art, and collectibles that they can donate. Your organization can either use the item for mission fulfillment (i.e., a museum can accept a work of art for its collection), or the organization can sell the item and put the cash to good use. You’ll just need to be clear with your donor about which option you intend to exercise.

Gifts from Donor Advised Funds. An increasing number of Americans have established a DAF. Be sure to remind your donors that they can advise that a gift be made to your charity from their DAF account.

IRA Charitable Rollover. Since the U.S. Congress has made the IRA Charitable Rollover permanent, individuals who are age 70.5 or older can donate up to $100,000 from their IRA each year without having to recognize it as income.

Year-end is also a good time to ask for deferred planned gifts such as Gifts in a Will, Beneficiary Designations, and Trusts.

You can read more about planned giving options by clicking here.

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February 24, 2017

What is the Special Ingredient that Leads to #Fundraising Success?

Do you know the special ingredient for creating fundraising success?

You’ll notice I didn’t say “secret ingredient.” That’s because it’s not a secret. It’s actually common sense. The reason I’m writing about it is that it is not yet common practice to the degree it should be.

The special ingredient is: building relationships.

Gerry Lenfest, 21st century philanthropist and Giving Pledge member, explained the importance of developing relationships when writing the Foreword to my book, Donor-Centered Planned Gift Marketing:

Knowing your prospects and understanding what motivates them are two critical steps in the [philanthropic] process. Quite simply, you cannot skip cultivation and relationship building and expect a successful outcome…. Do not make the mistake of forgetting about us once you receive our gift commitment. We may truly appreciate how efficiently and effectively you handle contributed funds so much that we entrust you with another planned gift. We are also in a position to influence others to do the same…”

While Lenfest’s comments were about planned giving, they certainly apply to any type of fundraising. Strong relationships are the key ingredient to a successful philanthropic process. By building meaningful relationships, you will:

  • Acquire more donors
  • Retain more donors
  • Upgrade more donors
  • Acquire more planned gifts
  • Generate more major gifts
  • Inspire donors to become ambassadors for your organization

Unfortunately, the nonprofit sector in general is terrible at building relationships. This is one major reason that donor-retention rates have been steadily falling for years, according to the Fundraising Effectiveness Project. While there is no shortage of great how-to material out there, charities are still failing to grasp the importance of embracing a robust stewardship program as part of the philanthropic process. You can search this site for donor retention to get some great tips.

For now, however, I want to share a heartwarming story of what can happen when you establish strong relationships with donors and inspire them to be ambassadors.

John’s Roast Pork is a destination sandwich stand in Philadelphia. John Bucci’s family-owned establishment has been around since 1930 serving the best roast pork sandwiches in the city. (Hey, Philly is about more than john-bucci-of-johns-roast-porkcheese steak sandwiches, though they serve those, too.) The James Beard Foundation designated the establishment as an “American Classic” for roast pork.

Unfortunately, earlier this month, John’s was burglarized. The perpetrator(s) got away with a few thousand dollars. The burglary also shut down the business until repairs could be made. The stolen sum included $1,500 that had been collected to benefit Be the Match, operated by the National Marrow Donor Program. The charity maintains the world’s largest and most diverse bone marrow donor registry.

Be the Match is important to Bucci. Several years ago, he fought a fierce battle with leukemia and was ultimately successfully treated with a bone marrow transplant. Since then, Bucci has been a supporter. At one point when he contacted the organization, he requested to meet his marrow donor so he could thank the person. However, he was told that the organization’s guidelines did not permit this. Here’s what Bucci told Philly.com he did instead:

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February 7, 2017

Get a FREE Book for Nonprofits by a Noted Researcher

Do you like getting something for free? I do, especially when it can help me be more successful.

Now, thanks to Russell James, JD, PhD, CFP, the Texas Tech University professor and philanthropy researcher, you can download a free, 427 page book that will become an important reference source in your fundraising library.

Whether you call it planned giving, gift planning, legacy planning, philanthropic planning, charitable estate planning, charitable gift planning, or something else, the subject is complex. However, it does not have to be overwhelmingly confusing.

visual-planned-giving-2017-coverTo help you, James has put together the book Visual Planned Giving: Introduction to the Law & Taxation of Charitable Gift Planning, newly revised and updated for 2017. Designed for fundraisers and financial advisors seeking to expand their knowledge about charitable gift planning, this introductory book addresses all of the major topics in planned giving law and taxation.

The gift planning topics you’ll learn about include elements of a gift, documentation requirements, valuation rules, income limitations, bargain sales, charitable gift annuities, charitable remainder trusts, charitable lead trusts, life insurance, retirement assets, private foundations, and donor advised funds. Over 1,000 full-color illustrations and images will guide you through complex concepts in a visual and intuitive way. James makes planned giving accessible and pain-free for the busy professional.

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December 29, 2016

You Don’t Want to Miss These Worthwhile Items from 2016

As the frenzied year-end fundraising and holiday season draws to a close, we have an opportunity to catch our breath this week. Like me, you’ve probably found that, between work and family, a 24-hour day just isn’t long enough to accomplish everything we want to do. We need a break every so often.

im-drowning-in-data-by-quinn-dombrowski-via-flickrWhen trying to stay on top of the latest fundraising and nonprofit marketing news and ideas, I know it’s time consuming just to sift through the wealth of articles, blog posts, and books that are published each year. It’s easy to drown in all the information. That means it’s also easy to overlook useful information.

With this blog post, I aim to save you some time and link you to some valuable material by listing some of my most popular posts of 2016, showing you where you can find other excellent bloggers, and by telling you where you can find books recommended by readers who are fundraising professionals and nonprofit managers.

Here is a list of my top ten most read posts published in 2016:

  1. Stop Showering All of Your Donors with Love!
  2. Stop Making Stupid Email and Direct Mail Mistakes
  3. Do You Know that “Planned Giving” is Bad for #Fundraising?
  4. Avoid a Big Mistake: Stop Asking for Bequest Gifts!
  5. Donors Say: Enough about You. Let’s Talk about Me!
  6. How Can Nana Murphy Make You a Better #Fundraising Professional?
  7. How to Avoid a Disastrous Political Debate with Donors
  8. 6 Great #Fundraising Tips from a 6-Year-Old Boy
  9. Do You Know How to Take Criticism?
  10. Stop Pretending that You Work for Stanford!

Here’s a list of five of my older posts that remained popular this year:

I invite you to read any posts that might interest you by clicking on the title above. If you’ve read them all, thank you for being a committed reader.

You might also be interested in reading about my guest blog posts on the Bloomerang site:

Recently, I was interviewed twice for the MarketWatch site. You can find links to the articles as well as my elaboration on my comments here:

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November 8, 2016

Are You Forgetting Something as Year-End Approaches?

It’s that time of year once again. #GivingTuesday and December 31 are fast approaching. All charities are looking for year-end donations. However, are you forgetting something important?

If you want to maximize year-end giving, you must seek planned gifts. Remember, not all planned gifts are deferred gifts; many are current contributions. Here are some types of planned gifts you should be asking for, even if you don’t have a formal planned giving program:

Gifts of appreciated stock or property (i.e.: real estate, art, collectibles, etc.):

By making a donation using appreciated stock or personal property, a donor can avoid capital gains tax and receive a charitable gift deduction. Because over half of Americans own stock (Gallup) and because the stock markets are at or near record highs, now is a great time for donors to contribute appreciated securities. Likewise, real estate values have generally seen significant rebounds since the Great Recession, meaning real estate gifts are an excellent option for some donors.

Gifts from a Donor Advised Fund:

Many donors have established a Donor Advised Fund. In 2014, there were over 238,000 Donor Advised Funds (National Philanthropic Trust, Donor Advised Fund Market Report 2015). DAFs “account for more than three percent of all charitable giving in the United States.”

pot-of-goldIf you’d like to learn more about how DAFs work, you can download the free FAQ sheet from DAF Direct by clicking here.

If you know that a donor has established a DAF, ask him to designate your charity for a grant. In your newsletter, include a story about a supporter who has given through her DAF. On your website, include a Donor Advised Fund widget to make it easy for your donors to designate a gift to your charity.

To see how International Planned Parenthood Federation / Western Hemisphere uses the DAF Direct widget, click here. To see how the UNICEF United States Fund has deployed the widget, click here. For information about how to get the Donor Advised Fund widget for your organization’s website, click here.

Gifts from an IRA Rollover:

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October 28, 2016

Get a Free Halloween Treat for Fundraisers

If you’re like most fundraising professionals, you’re not optimally asking donors to include your nonprofit organization in their will.

You’re probably not driving as much traffic to your planned giving webpage as you could.

You’re also probably less successful at closing Charitable Gift Annuities than you could be.

lone-ranger-and-silver-via-melocuentas-flickr

The Lone Ranger and Silver.

I know. You decided to read this post to discover how you can get a free Halloween treat. Instead, you’re probably starting to feel tricked. But, fear not! Russell James, JD, PhD, CFP, the Texas Tech University professor and philanthropy researcher, along with the good folks at MarketSmart, are riding in to save the day.

Last summer, James conducted a webinar hosted by MarketSmart. During his presentation, James unveiled his latest, powerful research findings along with research insights from others. You can learn more about the webinar and get some great tips by clicking here.

Now, for your treat, MarketSmart has distilled James’ webinar into a free, 22-page e-book that will help you raise millions of dollars more. For example, here’s just one simple, yet valuable tip:

When you want to engage people in a conversation about Charitable Gift Annuities, what is the best way to describe this giving vehicle to make folks want to learn more?

James tested five phrases. Among the 2,550 respondents, he discovered the percentage interested in learning more:

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August 5, 2016

The #Fundraising Secret for Success You Need to Know

What’s the secret to fundraising success?

Ice cream!

That’s right. Ice cream can help you achieve greater fundraising results. Really. I’m not just saying that because it’s August, and we’re setting new records for summer heat in Philadelphia. I know ice cream can help you because I saw first-hand what it has achieved for Smith College.

Let me explain.

This past Spring, my wife and I attended her class reunion at Smith. I enjoyed being with Lisa, and exploring the beautiful campus and the fun town of Northampton, Massachusetts. One of the highlights for me was seeing the College’s Gift Planning staff in action. Yes, I’m a bon-a-fide fundraising nerd, but you probably knew that already.

Sam Samuels, Christine Carr Hill, and Jeanette Wintjen staff the Smith College ice-cream stand during Reunion Weekend.

Sam Samuels, Christine Carr Hill, and Jeanette Wintjen staff the Smith College ice-cream stand during Reunion Weekend.

I’m not talking about seeing the staff in action at the mildly stuffy, but well presented, Grécourt Society reception for legacy donors. Instead, I’m referring to the ice-cream stand that the Gift Planning staff operated in the Smith College Campus Center one warm mid-day. As the staff served up the free tasty treats, they had a chance to interact with alumnae. When appropriate, the staff, wearing aprons and serving up the ice cream themselves, was able to casually explain what The Grécourt Society is, why legacy giving is important to Smith, and how alumnae can support the College with a planned gift. At the ice-cream stand, there was also a table of gift planning promotional material.

This was a great way to showcase gift planning in a friendly, pressure-free, guilt-free, fun environment. Sam Samuels, Director of Gift Planning, told me that the ice-cream stand not only allowed the staff to educate, cultivate, and thank people, it actually led to a number of planned-gift commitments during the reunion weekend.

Now, I’m not suggesting you go out and set up an ice-cream stand. However, if we examine why the ice-cream stand worked, there are some things you can learn that will help you reach your fundraising goals.

Here are five things you need to know:

1. KISS. In 1960, the US Navy noted the design principle “Keep it simple, Stupid!” That’s what we see with the ice-cream stand. The Smith staff did not over think it; however, they certainly did the planning necessary to make it work. But, the concept itself was simple. It wasn’t a fancy dinner or a posh reception to educate and cultivate prospects, though such events have their place. And Smith did some of those as well. However, this simple activity allowed the staff to reach a broader audience in a low-key fashion.

2. Lifestyle Enabling. The Smith staff put themselves in the shoes of their prospects and donors. In other words, they were donor centered when thinking about how to attract the attention of potential planned gift donors. Instead of trying to get donors to attend an estate-planning seminar (yawn), the staff thought about how to meet the needs and desires of the alumnae. Most folks like ice cream. So, the staff chose to do something that would meet alumnae where they were (in or near the Campus Center), and give them something they would likely want (a cool lunchtime treat on a warm day). The ice cream stand also harkened back to the days when, as students, they would meet up with friends for ice cream at the student center. In short, Smith helped the alumnae live the life they want. That’s what drew in the alumnae.

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July 28, 2016

Do You Know that “Planned Giving” is Bad for #Fundraising?

That’s right. “Planned Giving” is bad for nonprofit fundraising.

For years, I’ve been writing and talking about the problems with the term “Planned Giving.” Now, new research underscores what I’ve been advising: You should stop using the term!

Sometime ago, The Stelter Company conducted a survey that I cite in my book, Donor-Centered Planned Gift Marketing. Stelter found only 37 percent of Americans over the age of 30 have a familiarity with the term “Planned Giving.” We have no way of knowing what percentage of those claiming familiarity really, in fact, know what the term truly means.

Other terms have become increasingly popular as substitutes for “Planned Giving.” However, none has yet to gain sufficient traction to overtake the use of “Planned Giving.” Consider the results from simple Google searches I conducted for this post:

  • Planned Giving — 14.8 million results
  • Philanthropic Planning — 11.1 million results
  • Gift Planning — 5.7 million results
  • Legacy Giving — 2.1 million results

What we know is that the general public has little understanding of the term “Planned Giving” although it appears to be the best term we have. Unfortunately, popular does not mean effective.

William Shatner in The Grim Reaper by Tom Simpson via FlickrWhile “Planned Giving” is a reasonable, inside-the-development-office catch-all term to describe, well, planned giving, it’s not a particularly good marketing term. That’s according to the findings of philanthropy researcher Russell James, JD, PhD, CFP.

James conducted a study to answer this vitally important marketing question: “What is the best ‘front door’ phrase to make people want to read more Planned Giving information?”

Think of it this way: Will a “Planned Giving” button at your website encourage visitors to click through to learn more or is there a more effective term?

To be a successful term, James believes two objectives must be met:

  1. Individuals have to be interested in finding out more.
  2. Individuals have to expect to see Planned Giving information (i.e., no “bait and switch”).

To find the strongest marketing term, James asked people to imagine they were viewing the website of a charity representing a cause that is important in their lives. In addition to a “Donate Now” button, the following buttons appear on the website:

  • Gift Planning
  • Planned Giving
  • Giving Now & Later
  • Other Ways to Give
  • Other Ways to Give Smarter
  • Other Ways to Give Cheaper, Easier, and Smarter

James asked participants to rate their level of interest in clicking on the button to read the corresponding information. In a follow-up, James asked study participants what kind of information they would expect to see when clicking the buttons mentioned above.

The winning term is:

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