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William Clay Tucker, CAP, CMFC,CRPS

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Myth: Planned giving isn’t important. Most of our wealth is in cash. (i.e., Cash is king.)

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Fact: Only 5% of this nation’s wealth is in cash. That’s why it’s so hard to raise cash gifts.

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Fact: The typical planned giving target is 200 times the donor's largest annual fund [cash] gift.

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Fact: Donors find they can become more generous with non-cash gifts because of additional tax benefits.

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Myth: We are not ready for planned giving.

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Fact: If you are a non-profit, you are ready. Even organizations less than 8 years old and without a structured program are soliciting planned gifts.

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Fact: If you are holding off because you don’t yet have a formal planned giving "program," you are missing donors who are making gift decisions today.

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Fact: Your organization can accept gifts of appreciated assets, bequests and life insurance today , without any special arrangements with your business office.

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Fact: Other gifts are more complex, but you can partner with professionals who can help, such as banks and community foundations.

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Fact: Let your prospects know that you’re open for business – or watch the best gifts keep going elsewhere .

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Myth: It takes too long. We need the cash now.

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Fact: The average time from inception to maturity for a planned gift is 7-10 years — only a few years longer than most campaign pledge periods .

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Fact: Although most planned gifts are deferred, some provide current cash.

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Fact: One reason cash is in such short supply in many institutions is that they have little or no endowment. Planned gifts can build an endowment.

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Fact: By limiting yourself to immediate gifts, you are excluding a vast constituency of prospects who may only be able to give a large gift in their will.

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Fact: If you are scrambling to raise cash today, it's because, in part, your organization did not pursue planned gifts 5-10 years ago.

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Fact: Planned Giving = Proactive Planning

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Myth: Planned giving is complex, expensive and time consuming.

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Fact: It can be as simple or as complex as you want it to be. You can start simple with a bequest program.

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Fact: Even a simple, unattended program can raise significant funds.

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Advice: Don’t be penny wise and pound foolish… one can easily give up $500,000 in bequests to save $3,000 in their budget. Balance cost with value and return on investment.

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Advice: Within the next 15 years, over 6 trillion dollars will be passed from one generation to the next. Do not leave gifts on the table or forfeit them to another charity.

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Myth: Planned gifts compete with major gifts.

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Fact: Most planned giving donors are not prospects for large major gifts. Many fundraisers are nervous about pursuing planned gifts because they think they'll lose major gifts.

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Fact: Planned giving donors are the "millionaires-next-door" in your constituency, flying under the radar of your prospect identification systems.

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Fact: Planned giving often gives donors financial benefits, but it isn’t the number one reason they make gifts.

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Fact: They have different motivations than those major gift donors who seek recognition by having their names on big projects or buildings at your organization.

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Fact: A blended gift, i.e., a planned gift structured into an outright gift of a major donor can often increase that donor's total gift.

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Myth: Planned gifts are a distraction in campaigns.

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Fact: They provide up to 30% or more of comprehensive campaign totals. Reaches the “hidden constituency”… your most loyal donors.

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Fact: Capital campaigns focus on 5% or less of the donor base (major donor prospects). The major gifts donor pool and deferred gifts donor pool are not the same.

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A powerful start: Bequests, bequests, bequests.

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Fact: 42% of Americans die without a will.* *PPP Survey

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Fact: Only 1 in 3 donors told charity about their bequest in advance.* *PPP Survey

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Fact: More than 2/3 who made a planned gift also made a cash gift.* *PPP Survey

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Fact: Average age when a will is created is 44.* *PPP Survey

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Fact: 34% of donors learned about bequests from their charities.* *PPP Survey

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Fact: 21% of bequest donors had no prior affiliation with the charity.* *PPP Survey

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Fact: Additional non-survey information: 75-80% of all planned gifts are bequests.

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Fact: The average bequest is $20,000 - $70,000.

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Fact: A small percentage of donors change the commitment.

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Fact: Bequests are easy to market: they are the gift that costs “nothing during lifetime.” That is, a bequest does not affect one’s cash flow or lifestyle.

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Fact: Other charities are educating your donors and closing planned gifts – shouldn’t you?

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Who are these planned giving prospects?

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Myth: Planned giving donors are wealthy.

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Fact: Donors at all financial levels take advantage of planned gifts.

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Fact: Your best prospects are your most loyal donors, not necessarily your wealthiest .

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Fact: Wealth screening and demographic criteria alone are poor predictors of propensity to make a planned gift. The highest predictor is institutional loyalty.

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Fact: Most deferred gifts are made by those who do not benefit from estate tax deductions.

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Fact: Most planned gift donors give small gifts year after year rather than larger donations. (69% of planned giving donors give less than $500 per year and are unrated prospects.)

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Fact: The highest predictor of a donor's propensity to make a planned gift is institutional loyalty , not how much money they have.

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Fact: Households engaged in planned giving have a higher rate of participation in charitable giving, as well as higher average contributions than households not engaged in planned giving.

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Myth: Planned giving donors are old.

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Fact: 43% of bequests and 34% of charitable remainder trusts (CRTs) are created by individuals younger than 55. 15% of planned gifts are by those younger than 45.

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Fact: The age at which people begin financial planning for themselves and their families is becoming lower every year – let the option of planned giving be known to your constituencies early.

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Fact: While 69% of donors change their wills, only 25% change a gift in their wills.

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Fact: Ages Bequests CRTs 18-34 3% 6% 35-44 14% 10% 45-54 26% 18% 55-64 22% 20% 65-74 20% 23% 75+ 15% 24% Mean 58% 62%

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Myth: People give to get a tax break.

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Fact: A tax break makes it easier to give and easier to give larger gifts, but people give for other reasons.

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Fact: No. 1 Reason? They are asked or presented the opportunity to give. Yes, someone asked them.

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Fact: The other four reasons... Compassion for those in need They personally believe in the cause They are affected by the cause To give back to their community

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Planned giving marketing.

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Myth: Planned giving prospects are not online.

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Fact: Your website is the first place your prospects will go to find out about you.

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Fact: Adults 55+ are the fastest growing sector of the PC purchasing public. Seniors are getting "younger" – the first baby boomer turned 60 in 2006.

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Fact: 40% of all U.S. adults over the age of 50 – including 24% of those over 65 – use a computer at home.

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Fact: 70% of seniors who own a computer and 14 million North Americans age 50+ use the Internet on a regular basis.

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Fact: 65% of Americans age 55+ who are online use the Internet for research and investing.

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Fact: Seniors are 27% more inclined to invest online than their younger counterparts. A majority have invested online at least once over the last year.

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Fact: Internet users age 50+ are highly educated, affluent when compared to the general population, and purchase more in dollar amount online than younger surfers…

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Fact: 75% have a college-level education. 45% earn over $75,000 a year. 50% have investment portfolios worth over $100,000. These figures could be higher for your constituency.

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Myth: People read planned giving newsletters.

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Fact: Newsletters worked in the 60’s. Today, they rarely get read . Personalized letters, postcards, display ads and websites have a greater impact. Personal visits are a must .

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Myth: Email blasts are a cheap way to promote planned gifts.

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Fact: In 1999, this was a great idea. Times have changed. Most of your emails won’t get read.

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Fact: E-cards or e-mailing is a great idea for birthday greetings, but not planned giving... Americans read their email with their fingers on the delete key.

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Fact: Your e-newsletters and planned giving e-cards will not get read for the same reasons your newsletters won't. Many e-marketing pieces get spammed out.

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Fact: Even if your prospects have opted-in to hear from you, they will soon ignore your emails. You can easily alienate your prospects with mass emails and e-marketing.

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Myth: Planned giving websites close planned gifts.

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Fact: Handshakes close planned gifts. People give to people, not organizations. It’s important to have a planned giving website… but do not rely on it to work on its own.

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In Closing... Annual giving is important, and urgent. Planned giving is also important, and proactive. Our endowment is like a retirement account. If we do not plan today for tomorrow, we may be in crisis tomorrow, which could jeopardize our programs and services.