The Potential in Planned Giving

The Potential in Planned Giving

October 27, 2009 by jga_admin

by Dan Schipp

Recently I joined several of my JGA colleagues in attending the Indiana AFP fall conference. Penelope Burk, author of Donor Centered Fund-Raising and President of Cygnus Applied Research, was the featured speaker. Her appearance was sponsored by JGA.

In one of the conference sessions Penelope spoke about the great, but largely unrealized, opportunity awaiting not-for-profit organizations in planned giving. She particularly focused on the most simple of planned gifts - a bequest. She cited research that shows 43% of Americans say they are interested in making a bequest to a charitable organization. Only 8% of wills, however, do include a charitable bequest. So there is potential to increase by almost five-fold the number of estate plans that include charitable bequests. And when you consider, as Penelope pointed out, that a bequest, on average, is four times a person's major gift to the not-for-profit organization, the potential is enormous.

So why aren't organizations promoting and pursuing bequests more actively? I suspect some feel that they do not have the expertise to support a planned giving program. But encouraging donors to consider charitable bequests does not require a lot of technical knowledge. Another reason may be - and most likely it's the main reason - is that the organizations are focused on generating current operating dollars and do not want to fracture that focus.

Great things can happen when you make a commitment to pursuing planned gifts, especially bequests. Let me offer one example. I know of an organization that launched a planned giving program in the late 1960's a few years after it started a development program. Ever since that organization has had one staff member who has concentrated on planned giving. In the first three years of that organization's planned giving program, realized bequests amounted to less than 5% of total gift income. In the next decade that percentage increased to 12%. In the second decade it rose to 26%. In the third and fourth decades after the planned giving program started, bequests totaled more than 40% of that organization's total gift income!

I am not suggesting that any organization abandon its annual giving program to pursue planned gifts. Every organization can be doing something, however, to promote bequests, even if it is just reminding benefactors in appeal mailings or newsletters to "Remember XYZ Organization in Your Will." Other simple steps are featuring stories of charitable bequests in your publications and on your website and, most importantly, having conversations about bequests with donors, especially those who have a long record of giving and/or a high frequency of responding to appeals.

The potential in planned giving is great. Patience, persistence, and simply getting started, are essential in realizing that potential.