Simple Starts for Planned Giving

As you have undoubtedly already heard, recent proposed changes in US estate taxes, an aging population, and recent volatility in the stock market are all factors in an increased interest in charitable gift planning arrangements. These conditions are coinciding with many nonprofits’ search for additional funding sources, resulting in a flurry of attention in the nonprofit media on planned giving program. Given this new level of discussion, launching a planned giving program can seem necessary. But giving the list of responsibilities currently managed by fundraisers and development officers, it can also seem overwhelming.

If you are starting to feel that you should hang up your planned giving hat because you don’t understand all the nuanced differences between Charitable Remainder Unitrusts and Charitable Remainder Annuity Trusts, you are not alone. You don’t have to leap into a full offering of Trusts and be able to recite your states annuity laws today to embrace this growing opportunity. Smaller organizations can garner some simple planned gifts with a reasonable amount of planning and execution. Here are three planned giving instruments that are relatively easy to manage-- for both donors and charities.

Wills and Bequests
70-80% of planned gifts come as bequests. If the only planned giving program you enhance includes telling targeted donors to remember your charity in their will, you have begun to address the most popular planned gift with your donors. You may want to start a legacy society or enhance an existing one to kick of an education and awareness campaign to your targeted constituents.

Gifts of Stock
Appreciated public stock can be directly given to a nonprofit. If your nonprofit wants to accept this type of gift, you should open an account. Any donor education should include a reminder to your targeted donors to let the organization know when they plan a transfer, or you may end up with a gift of unknown origin. Gifts with no identifiable donors mean fundraisers with unsent thank you notes, and unrecognized donors.

Gifts of Life Insurance.
Once a family is grown and financially secure, donors may sign over a paid up whole life policy to a charity by making the charity the policy beneficiary. This simply takes a “change in beneficiary” form. The donor retains ownership of the policy and has the flexibility to change their mind later. Like a will, they can revoke beneficiary status fairly easily by simply submitting the same form again. Another option for gifts of insurance is for a donor to gift the paid up whole policy outright to the charity. This is not revocable—the charity then “owns” the policy. Unlike simply changing the beneficiary status, this method provides the still living donor an income tax benefit.

No matter what type of Planned Gifts your group chooses to accept, you can get your team ready by leveraging contact details in your fundraising software. Be sure ages are captured in your donor profiles, and train your staff to add any mention of an intention of a bequest, or the desire to do something special for your group to your profiles.