Planned Giving for the Moderate Donor
My father was a retired Presbyterian minister. He lived a life of service and of deep satisfaction but not one that brought large financial reward. When, at age 72, he sat on the 50th reunion committee of his alma mater, a college to which he was devoted and to which he contributed regular small donations, he felt he could not make a large gift to his reunion fund — until he discovered charitable gift annuities.
A charitable gift annuity is a contract between a donor and a charity in which the charity pays a donor a fixed amount for life in return for the donor’s gift of cash, stock or real estate. Because a CGA brought with it a regular dependable income stream, my father was able to contribute what was for him a gigantic sum of $15,000, far more than the $250 he could have contributed out of income. The pride he felt in being able to make that gift was the most important part of the benefit.
Almost all charities have donors who look much like my father. They are not wealthy but they are generous and committed, and they demonstrate that commitment through regular, even if small, annual contributions. They also are prime prospects for a planned gift.
In 2000, the National Committee on Planned Giving conducted national research study about patterns of giving that found that more than 70 percent of those who put a charity in their wills and more than 60 percent of those who established charitable gift annuities or charitable trusts had incomes of less than $100,000, and more than one third of those in both categories earned less than $50,000. Immense wealth clearly is not an essential to be a planned-gift donor. And most of these donors’ estates come nowhere near the point at which the estate tax kicks in.
Individuals, like my father, who have already indicated a commitment to the organization through their regular giving are those for whom planned giving is especially valuable. These are the people who are legitimately worried about outliving their income, for whom a charitable gift annuity might provide peace of mind as well as the satisfaction of giving to an organization they care about. These are the people who believe in the long-term financial health of the organization and whose annual giving often increases, as my father’s did as well, after they have made what for them is a truly major commitment.
Small focus groups can provide invaluable information about how to discuss CGAs with potential donors; they also can stimulate many participants to complete gifts that they otherwise never would have considered. Focus groups are inexpensive and highly effective ways both of identifying new prospects and closing new gifts, regardless of the size of the organization.
Some tips to keep in mind:
* The key to successful focus groups is that they are designed to ask people’s advice instead of “selling” them on something or “educating” or “training” them.
* Focus group participants need to understand the issues you present to them in order to give advice, but most nonprofits will find participants love to give advice, and that their advice often is quite valuable and insightful.
* Donor curiosity and donor participation in thinking through the best ways of marketing a new planned-giving idea frequently stimulates more gifts than pressure or slick presentation.
Bruce Bigelow is a founding partner of Charitable Development Consulting, a firm that offers targeted advice to nonprofit organizations on a variety of fundraising issues. He can be reached at bigelow@charitabledevelopmentconsulting.com
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