Planned Getting

A fair number of my clients have figured out that along with raising enough funds for today, they need to start now on raising enough funds for tomorrow. That means endowment, and that typically means planned gifts. While cash today to be invested for tomorrow is fantastic, for many people, it is not quite doable. But making a future gift where you don’t actually have to give until tomorrow—often a far tomorrow--that is something they can get their arms around. But, as organizations embark on a planned giving program, too often they forget about the purpose people give and fall in love with the vehicles; the various ways people can make a planned gift. Most of the organizations I work with need to think simply. That is, while there are a world of planned giving vehicles, most of them are not the gifts that they should be focused on. They need to think bequests--becoming a beneficiary of someone's will or trust, life insurance policy or retirements plan.

The other, more sophisticated gifts, are not necessarily beyond what they can do, but they are--by and large—gifts that should come out of a donor’s needs, not something that is sold to them. Beside, it is critical is to know what the organization can handle and what it cannot.

For example, no small organization should agree to being a trustee of a Charitable Remainder Trust, and if you are in California or New York (and perhaps some other states), know that you cannot sell a charitable annuity. The donor must buy those elsewhere "for the benefit of" your organization.

But before you reach out to your donor pool for planned gifts, you need to make sure you have the right infrastructure in place.

Much of what is right for planned gifts are the same things that should be in place for any gifts, but, often they are not.

The first, most important thing is a gift acceptance policy. While these policies can be very simple, it is crucial that think long and hard about what the organization will and won’t accept, and under what circumstances. I’ve seen too many organizations say, “Of course we will accept all real estate, what’s the problem. We’ll simply sell the property—and make money to boot.”

Well, maybe. In a good real estate year. But if there is a lien on the property and prices plummet (or the formerly great neighborhood is not so desirable any more, or the house is in terrible shape) your organization may find itself “under water”. Paying far more for taxes, mortgage, maintenance than the property is worth.

Or what if someone leaves you personal property with the caveat that you may not sell this particular item. Are you now stuck paying for a safe deposit box for some jewelry you can’t sell and have no other possible use for?

Because endowment is an invested pool of money you must have an investment policy. And you need a spending policy as well.

Other things you need to consider include your donor recognition plan. How will you celebrate the planned gifts you receive? One and done may be well and good for an annual gift, but it may not sit well with a larger planned giver. Be thoughtful about recognition and stewardship of these gifts. After all, planned givers, typically are loyal annual donors, unless you don’t give them enough reason to continue to love you.

So before you set out to get planned and endowed gifts do the foundation work. Consider why endowment is so critical—for you, yes, but mainly for your donors. And think about the mechanics involved in managing the gifts you will get. In other words, plan your getting as carefully as you donors will be planning their giving.


Janet Levine works with nonprofits, helping them to increase fundraising results. Check out her website, www.janetlevineconsulting, and while there—sign up for the free newsletter and email Janet for a free 30 minute consultation