Planned Giving: Attracting Legacy | The Conversation
Many prospective donors already support you financially, are conscientious volunteers and respond to special appeals. Whether the dollar amounts are large or small, their commitment to your arts vision is deep and longstanding. Within your donor community are individuals/families who are committed to your long term sustainability and to supporting you through estate or planned gifts.
The conversation around these gifts can be quite different from the ‘annual’ campaign conversation.
Planned giving is an important aspect of a donor’s tax and estate planning process. Such gifts may be implemented during their lifetime (involving tax planning), or as a bequest after their death.
A bequest is their way, one last time, for a donor to tangibly demonstrate their support of your arts mission after their death.
What is important to know about Legacy giving?
Planned giving is episodic -- most donors approach the subject hesitantly. There is often no single event that triggers the decision to make a planned gift or a bequest within the estate plan. The decision takes time and you may not receive the gift for months or years.
When generating legacy or planned gifts, start by considering your long-term donors, their age/demographic profile and the nature of their commitment to your organization.
Consider asking them the question – ‘Given your commitment to our organization, have you ever considered a legacy gift to us?’
If they say, “Yes”, first confirm why they want to give and then how they want the gift be used.
Using their goals as a starting point, share ways they can move forward by providing general information on planned giving, and refer them to their legal/tax advisors. Keep your language easy to understand as this may be unchartered waters for them. (If you are speaking too simplistically, they will soon tell you and you can adjust your choice of language accordingly.)
How can I best manage the conversation?
1. Remember that the conversation is not about a ‘transaction.’ You are talking with someone about their life goals – be it a tax planned gift or a future bequest. Within reasonable bounds, let the donor talk about their life, their dreams and vision for your organization. Your conversation is about them and they may offer valuable insights to help you with other fund raising efforts.
2. Listen actively and ask clear questions to help them clarify goals and highlight opportunities. You will understand their motivations better while collaboratively guiding them to the right outcome for them.
3. A gifting decision is usually shared by spouses/partner– Involve both parties in the conversation and don’t presume that you know who the ‘decision maker’ is.
4. Donors may tell you they have already made a legacy/planned gift through their will/estate – but may choose not to disclose the amount. You can ask them if they are willing to share that information, but respect their privacy. If they have made a bequest, it may be many years before it is realized. Whether the gift is $1000 or $100,000., be sure to thank them as they are a valued supporter.
5. Discuss their recognition. Does the donor wish to be recognized, and when and in what form would they like to be acknowledged?
6. Continue to stay in touch over time and recognize the donor(s) as long-term supporters. Your failure to stay in touch may result in them revising their estate plan.
Be ready as an organization
If seeking legacy/planned gifts reflects your fundraising goals, your board should develop a ‘gift acceptance policy’ to articulate how the organization wants to handle these gifts. The board should consider a policy clarifying ways to:
A ‘gift acceptance’ policy is part of wise governance.
Who should I focus on?
Engaging supporters who are most likely to be considering intergenerational planning makes the most sense. Consider people who are age 50+, and are beginning to think about their personal legacy. You may also have donors who are aware, may have tax planning opportunities (through the sale of a business, for example) and may be ready to consider planned gifts as a tax planning tool.
Including information in reader-friendly language on your website about the basics of planned/legacy gifts can help you plant the seed of long term gifts within younger donors. Donor testimonials can be very powerful in encouraging the conversation.
Why do this?
Long term gifts create opportunities, and result in a strong connection between your organization and the donor. Planned gifts result in financial support for your organization while supporting the financial and tax planning objectives of your key donors.
We can’t predict the future, but if you believe your arts mission is relevant today and over time, you have donors who want to support that mission.
In the words of a donor -
For myself and other colleagues of my generation, decisions about the distribution of our accumulated wealth are happening right now.