Posts tagged ‘Giving USA 2015’

June 26, 2015

Are You Wasting Time by Hunting Unicorns?

Go to any fundraising conference, and you’ll find unicorn hunters. You might even be one. You can see the unicorn hunters in seminar sessions about Charitable Remainder Annuity Trusts (CRATs), Charitable Lead Trusts (CLTs), and Charitable Remainder Uni-Trusts (CRUTs).

Unicorn hunters believe that Trusts are the cornerstone to a healthy planned giving program. Unicorn hunters scour the wealthiest portion of their donor files to find Trust prospects and then focus an enormous amount of time and energy trying to close big Trust gifts.

Unicorn by Rob Boudon via FlickrSome would-be unicorn hunters are overwhelmed by the hunt. They fear they have no prospects and/or they fear they have insufficient knowledge to pursue such gifts. So, they don’t implement any kind of planned giving effort.

Well, here’s your reality check, courtesy of Giving USA 2015: The Annual Report on Philanthropy for the Year 2014.

As the chart below reveals, the number of Trusts is tiny compared to the number of Public Charities which stood at 963,234 in 2012 (not including religious congregations and organizations with less than $5,000 in revenue), according to the Urban Institute’s The Nonprofit Sector in Brief 2014.

Even if every single charity that received a Trust gift only received one, that would mean that less than 12 percent of charities would have received a Trust gift in 2012. In other words, the likelihood that a fundraiser will close a Trust gift is very small in any given year. Moreover, the odds have been getting smaller as the number of charities has grown while the number of Trusts has declined.

Of course, that’s not quite how it works in the real world. In the real world, large organizations with large donor files containing plenty of wealthy supporters are far more likely to close Trust gifts than smaller organizations with smaller donor lists. If you don’t work at a large, established organization, the chances that you’ll close a Trust gift this year are miniscule.

 Trust Chart - 2015

While the dollars associated with Trust gifts are certainly significant, the actual number of such gifts is small. By contrast, far more people name a charity in their will, make beneficiary designations, give appreciated securities or personal property, or donate from their IRAs.

Keeping your eyes open for Trust-gift opportunities can be beneficial. However, you’re much more likely to close other types of planned gifts. This means:

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June 19, 2015

Are You Throwing Away Planned Gift Opportunities?

Since 1974, Charitable Bequest gifts have totaled seven to nine percent of overall philanthropic giving.

In 2014, Bequest revenue totaled $28.13 billion, accounting for eight percent of overall giving and an increase over 2013 of 13.6 percent (adjusted for inflation). These figures come from the recently released Giving USA 2015: The Annual Report on Philanthropy for the Year 2014.

Here are some questions to help you determine if your organization is getting its appropriate share of the Charitable Bequest pie:

Does your organization have a planned giving program?

If your organization has a planned giving program, good for you; skip to the next question.

LuMaxArt FS Collection Orange0128 by Scott Maxwell via FlickrIf your organization does not have a planned giving program, why not? The only valid reason for not promoting planned giving is that your organization does not have any individual donors. If your organization has individual donors, there’s no reason not to have a planned giving effort.

While smaller nonprofit organizations might not have elaborate, sophisticated planned giving programs, they can certainly promote Bequest giving, gifts through beneficiary designations, gifts of life insurance, donations from IRAs (when permitted by the government), contributions of appreciated stock, and gifts of personal property.

By promoting planned giving, even small charities can get a slice of the Bequest pie. Not only that, they can even help grow the pie. Just over five percent of Americans name a charity in their will. However, one-third say they would be willing to consider including a charity in their will. There is a massive chasm between these two figures. If more nonprofits ask more people for more planned gifts, we could see far more than five percent of Americans including a charity in their will.

To learn more about planned gifts any organization can seek and how to get them, register for my free webinar “Planned Giving: It’s Easier than You Think!,” hosted by Wild Woman Fundraising on July 17, 2015, 3:00 PM (ET) to 4:30 PM (ET).

Do you have a ROBUST planned giving program?

Okay, you have a planned giving program. Good. But, is it a robust effort or do you simply market passively or focus primarily on your wealthiest donors?

If you simply market passively and expect your donors to make a planned gift without being asked, you’re missing out on gifts your organization should be getting. Just like with any other type of fundraising, you actually have to ask for Bequest commitments if you want them.

If you focus only on your wealthiest, biggest donors, you’re missing a huge opportunity to grow your results. Yes, it’s true that wealthy donors leave the most to charities. In 2014, “estimated Bequest giving from estates with assets $1 million and above amounted to $22.12 billion,” according to Giving USA 2015, while “estimated Bequest giving from estates with assets below $1 million amounted to $6.01 billion.” However, there’s still a lot of money being raised from less wealthy supporters. And there is tremendous potential to raise even more from these individuals.

Here’s what Giving USA 2015 has to say about prospecting for Bequest intentions:

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June 16, 2015

Strong American Philanthropy at a Record High!

Americans donated an estimated $358.38 billion in 2014, surpassing the peak last seen before the Great Recession, according to the 60th anniversary edition of Giving USA, released today. That overall total slightly exceeds the benchmark year of 2007, when giving hit an estimated inflation-adjusted total of $355.17 billion. However, Individual giving has yet to recover fully.

The 2014 philanthropy total increased by 5.4 percent, when inflation adjusted, over the revised estimate of $339.94 billion that Americans donated in 2013. Giving has grown for each of the previous five years. The growth in 2014 significantly outpaces the average growth rate of 3.4 percent (inflation adjusted) during the past five-year period.

All four sources of contributions that comprise total giving increased in 2014:

  • Individuals (72 percent of the total, 4 percent inflation-adjusted increase)
  • Corporations (5 percent of the total, 11.9 percent inflation-adjusted increase)
  • Foundations (15 percent of the total, 8.2 percent inflation-adjusted increase)
  • Bequests (8 percent of the total, 13.6 inflation-adjusted increase)

Giving USA 8.5 x 11 Infographic“The 60 year high for total giving is a great story about resilience and perseverance,” says W. Keith Curtis, Chairman of the Giving USA Foundation and President of The Curtis Group. “It’s also interesting to consider that growth was across the board, even though criteria used to make decisions about giving differ for each source.”

When combining the Individual and Bequest numbers, we see that individuals contributed 80 percent of all dollars given to charity in 2014. If we include family foundation giving, individual philanthropy accounted for 87 percent of all dollars given in 2014, according to Patrick Rooney, PhD, Associate Dean for Academic Affairs and Research at the Indiana University Lilly Family School of Philanthropy. Large Individual gifts of $200 million or more accounted for a significant portion of the overall growth in Individual giving while the actual number of gifts over $1 million has decreased.

“We saw several very large gifts greater than $200 million — a few were greater than $500 million and one was nearly $2 billion — in 2014,” says Rooney. “The majority of these mega-gifts were given by relatively young tech entrepreneurs.”

Looking at the nine gift recipient categories, all but one saw an increase in giving:

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