Thou Shalt Not …

The Seven Commandments of Planned Giving highlight areas to avoid as we interact with donors and ask for planned gifts. By reviewing each commandment, you can develop a road map to assist you as you navigate through the perils of planned giving.

1. Thou shalt not ignore donors’ motivations, goals and financial situations.
It’s important to know more than cursory information about donors before creating and recommending an appropriate gift proposal. Since planned gifts are generated from matching donors’ passions and goals with what your organization has to offer, get to know your donors by building genuine relationships with them. Find out what’s important to them, what motivates them and how they’d like to put their charitable dollars to work.

In addition, you need to know your donors’ financial situations before recommending an appropriate charitable gift. For example, you shouldn’t recommend a charitable trust over a bequest if you don’t now about the donor’s assets and whether or not a trust is feasible given her desires coupled with her finances.

2. Thou shalt not make recommendations without adequate technical advice.
It’s important to know the legal tax implications of recommended gifts. Luckily, most major donors want to seek professional advice from a lawyer, CPA or some other type of financial advisor before agreeing to a large gift.

So bring your donors’ professional advisors into the loop early on in
the discussions. Have them counsel your donors on the tax effects of
their gifts and provide any needed legal advice. You don’t want to be held accountable for that; let the professionals do it. In addition, inviting the advisors to be involved will make them less likely to act as gatekeepers and oppose your proposal.

3. Thou shalt not recommend an inappropriate gift vehicle.
Not all gift vehicles are appropriate for certain assets. Depending on the type of asset your donor has under consideration, some vehicles work better than others. For example, the following assets and vehicles can be quite troublesome when paired together: real estate in a charitable remainder annuity trust; tangible personal property in a charitable remainder unitrust or annuity trust; mortgaged property in a charitable remainder unitrust or annuity trust.