Best Practices to Advance Planned Giving
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Best Practices to Advance Planned Giving

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How, when and why to secure planned gifts that bring real returns....

How, when and why to secure planned gifts that bring real returns.

Components and relative benefits of bequests in wills, annuities, a variety of trusts, retirement accounts and other planned gifts to nonprofits are described.

Why nonprofit board trustees, senior managers, advancement professionals, every staff member and stakeholders can help stimulate the easiest gifts to make – planned gifts that secure an institution’s future!

Roles of planned giving newsletters, seminars, financial and legal advisors, board trustees and individual visits.

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Best Practices to Advance Planned Giving Presentation Transcript

  • 1. Best Practices to Advance Planned Giving Rod Miller July 25, 2012A Service Of: Sponsored by:
  • 2. INTEGRATED PLANNING Advising nonprofits in: www.synthesispartnership.com •  Strategy •  Planning (617) 969-1881 •  Organizational Development info@synthesispartnership.com A Service Of: Sponsored by:
  • 3. A Service Of: Sponsored by:
  • 4. Today’s Speaker Rod Miller Founder Executive Institutional Advancement ExchangeAssisting with chat questions: Hosting:Jamie Maloney, Nonprofit Webinars Sam Frank, Synthesis Partnership A Service Of: Sponsored by:
  • 5. Best Practices to Advance Planned Giving Rod Miller, Founder Executive Institutional Advancement Exchange www.ExecIAE.com
  • 6. What is a Planned Gift?1. Made during an individual’s life2. Benefits nonprofit (NPO) in future3. After death of the individual and/or beneficiary © Executive Institutional Advancement Exchange LLC 2012 2 www.ExecIAE.com
  • 7. Advancement Best Practices on LinkedInWhy, when and how to plan and execute best practices forinstitutional advancement - share insights, ideas and creative ways to transform advancement efforts. For board trustees, CEOs and leaders with vision and commitment to best practices for growing revenue, philanthropy and marketing impact. http://www.linkedin.com/groups?gid=3874810 © Executive Institutional Advancement Exchange LLC 2012 3 www.ExecIAE.com
  • 8. What are Best Practices?A best practice is a method, process, activity, incentive, or reward that is believed to be more effective at delivering a particular outcome than any other technique, method, process, etc. when applied to a particular condition or circumstance… ... en.wikipedia.org/wiki/Best practices © Executive Institutional Advancement Exchange LLC 2012 4 www.ExecIAE.com
  • 9. Advancement Best Practice Steps1. Assess values, case, needs, goals and resources.2. Review advancement strategy, process and behavior on-site.3. Benchmark internally.4. Engage new, key stakeholders.5. Select and empower right leaders.6. Sign-onto ROI performance: outputs, process and behaviors.7. Establish pertinent, high-speed follow-through.8. Reference benchmarks of world’s best practice.9. Review trajectory and reward improvement.10. Reassess stakeholder engagement. © Executive Institutional Advancement Exchange LLC 2012 5 www.ExecIAE.com
  • 10. Best Practices to Propel Giving1. Discover new key stakeholders.2. Recruit right leaders (volunteer and staff).3. Empower communications (pertinent and quick).4. Grow the annual fund and mega-gifts (including planned gifts).5. Assure follow through (3600 collaboration). © Executive Institutional Advancement Exchange LLC 2012 6 www.ExecIAE.com
  • 11. Common Planned Gifts• Outright gift in future (even to annual fund) – Stocks/bonds – Real estate, antique or other property – Retirement fund• Trust instrument or bequest in Will – Irrevocable – Revocable• Annuity or variable asset• Life insurance © Executive Institutional Advancement Exchange LLC 2012 7 www.ExecIAE.com
  • 12. Bequest in Will• Make and review – Seek % of estate – Restricted/unrestricted – Beware narrow terms of application• Change with Codicil – Have wording readily available (obtain legal advice) © Executive Institutional Advancement Exchange LLC 2012 8 www.ExecIAE.com
  • 13. Planned Giving Priorities• Plan energetic engagement.• Understand planned gift principles.• Respect individual’s family/financial needs.• Avoid specific advice or influence.• Communicate creatively and frequently. © Executive Institutional Advancement Exchange LLC 2012 9 www.ExecIAE.com
  • 14. 1. Discover Planned Gift Potential“Easiest gift to make…”• Engage planned gifts task force at board-level• Gather information from members of institution• Mine institution’s database• Showcase benefits from planned gifts• Frequent news items/newsletters/updates• Information seminars on planned giving• Inform financial/legal professionals © Executive Institutional Advancement Exchange LLC 2012 10 www.ExecIAE.com
  • 15. NPO Stakeholders Board •Network NPO Family Previously • Management Involved • Staff • Board • Clients • Staff etc • Patients • Clients • Students • Contacts • Parents • Professions Community Affiliates • On/Near Site • Any who value services © Executive Institutional Advancement Exchange LLC 2012 11 www.ExecIAE.com
  • 16. Why Emphasize Planned GivingEstimated 50% to 66% people die without a Will USA (66% of African-American/75% of Hispanic populations) Canada, Australia, Great Britain…Rapidly growing assets of ageing baby boomers © Executive Institutional Advancement Exchange LLC 2012 12 www.ExecIAE.com
  • 17. www.ExecIAE.com 13
  • 18. 2. Recruit Right Leaders – Task ForcePurpose: identify and help engage new potential donors – understood limited term > “thanks” > new bloodGood leadership – succession, mix board trustees and peers – Diversity of background, sex, occupation, geography, etc (“right” people)Action meetings/agenda/minutes – Strong staff support – Invited, informed, involved and thanked – Interesting meetings (pre-planning with chair, solicitation materials) © Executive Institutional Advancement Exchange LLC 2012 14 www.ExecIAE.com
  • 19. Build Relationship for Change Discover who cares Partner Engage for remedy CEO Share Suggest interests options & values Listen © Executive Institutional Advancement Exchange LLC 2012 15 www.ExecIAE.com
  • 20. Empower Planned Giving Officer• Make/coordinate minimum 5 visits per week, in year-1• By year-3, some closures on planned gift instruments• Within 5-7 years, planned gifts may provide income• Some estimate planned gifts at 10 times what’s notified © Executive Institutional Advancement Exchange LLC 2012 16 www.ExecIAE.com
  • 21. Align Expectations and Efforts• 100-day plan to execution• Personal engagement (board trustees, CEO, advancement)• Initial 5 to 7 year commitment © Executive Institutional Advancement Exchange LLC 2012 17 www.ExecIAE.com
  • 22. 3. Empower Communication“Good advice for gift planners: stop talking about tax savings andthe technical aspects of gifts.Instead, combine the emotional appeal of your mission with theimpact the donor’s gift can make, and you will have a winningformula.” - Phyllis Freedman, “Planned Giving Blogger” July 20, 2010 www.ExecIAE.com 18
  • 23. Focus Future www.ExecIAE.com 19
  • 24. Focus Future www.ExecIAE.com 20
  • 25. Focus Future www.ExecIAE.com 21
  • 26. Focus Future www.ExecIAE.com 22
  • 27. Value of Planned Gift to Donors• Opportunity to make a larger gift.• Avoid capital-gains tax.• Retain individual income.• Convert a highly appreciated asset.• Set value of assets for tax purposes.• Cut taxes on transfer of owned business.• Pass assets to heirs and/or NPO. © Executive Institutional Advancement Exchange LLC 2012 www.ExecIAE.com 23
  • 28. Types of Givers• Impulsive• Habitual• Careful• Thoughtful © Executive Institutional Advancement Exchange LLC 2012 24 www.ExecIAE.com
  • 29. Most Effective CommunicationPersonal visits by 1. board-level peer 2. CEO 3. advancement professionalAdditional visits by board member/CEO/professionalEach followed by a personal 1. letter (with visit/telephone follow-up) 2. phone call, with brief follow-up letter © Executive Institutional Advancement Exchange LLC 2012 25 www.ExecIAE.com
  • 30. Integrate Marketing Support1. Brochure/web – How to make planned gift to NPO2. Word-of-mouth, viral – Launch and repetition: “NPO accepts planned gifts/how”3. NPO web/publications/mailings – Advertise: “Photo + 50-150 word stories on who benefits”4. Community affiliates/community news – For information: “Photo + 250 word story on who benefits”5. Estate, wealth management sessions – Specialist information offered by NPO6. NPO planned giving newsletter7. Media-worthy stories © Executive Institutional Advancement Exchange LLC 2012 26 www.ExecIAE.com
  • 31. Overview Planned Gift Vehicles*Planned Gift Charitable Deferred Charitable Grantor Lead Retained Life Gift Charitable Remainder Annuity EstateElements Gift Annuity Trust Trust Annuity Income No more than No more than One or more NPO None Beneficiary 2 individuals 2 individuals individualsHolds Remainder NPO NPO NPO Donor NPO Rate of Return Funct. Age/# Funct. Age/# Min. of 5% Variable Not Applicable beneficiaries beneficiaries market value Payments to Fixed amount Fixed, deferred Fixed Fixed amount None Beneficiary payment percentage Term Life income Life income Life inc. ben… Life/spec. term Life of spousesFederal Taxation Portion Portion Inc. tax-free… May be... Appraise value State/City Tax Varies Varies Varies Varies Varies Rec. Min. Gift $10,000 $10,000 $100,000 Open Personal Res…Accepted Assets Cash/stock Cash/stock Cash/stock… Cash/other… Real EstateRec. Min. Age of 65 35 60 No minimum To set Beneficiary • For Example Only: obtain advice from qualified 27 lawyers on all details
  • 32. Comparison of Options Computer simulations available to project examples, based on variables of age, asset base,percentage returns (where applicable)…etc. © Executive Institutional Advancement Exchange LLC 2012 28 www.ExecIAE.com
  • 33. Inform Legal/Finance ProfessionalsKeep interaction based on “information-only”• Lunch/breakfast briefing about NPO (on-site) – Tour examples of how bring benefit – NPO planned giving materials Presented by CEO• Visits/mailings: NPO planned giving materials © Executive Institutional Advancement Exchange LLC 2012 29 www.ExecIAE.com
  • 34. Estate/Tax Planning Update• Seminar on ways to – Reduce taxes on income, capital gains and estates – Use a trust to control assets and pass assets to heirs – Plan a financially secure retirement – Bypass capital gains taxes on stocks, real estate etc. – Plan gift arrangements to maximize your estate and family inheritancePresented by qualified (institutional) lawyer… free… no solicitation © Executive Institutional Advancement Exchange LLC 2012 30 www.ExecIAE.com
  • 35. 4. Grow Mega-planned Gifts Older people Assets % of estate © Executive Institutional Advancement Exchange LLC 2012 31 www.ExecIAE.com
  • 36. Family Wealth Management• (Live-in) Workshop(s) on ways to – Sustain philanthropic intent of parents/grandparents – Use various trusts to save income, gift and estate taxes – Provide for children’s or grandchildren’s education/future – Obtain valuable tax and other financial benefits from gifts – Plan for IRA distributions and beneficiary arrangements – Establish or maintain family foundationConducted by NPOs professionals, with qualified (institutional) lawyers/financial planners… free … no solicitation © Executive Institutional Advancement Exchange LLC 2012 32 www.ExecIAE.com
  • 37. 5. Ensure Follow-through One well-briefed NPO point-of-contact for Planned Giving inquiries © Executive Institutional Advancement Exchange LLC 2012 33 www.ExecIAE.com
  • 38. 100-day Plan to Execution1. Expect R.O.I.2. Planned gift task force3. Gift acceptance policy4. Agree team actions5. Identify high potential6. Schedule visits7. Follow-through benchmarked to best practice …Secure initial results © Executive Institutional Advancement Exchange LLC 2012 34 www.ExecIAE.com
  • 39. Measure R.O.I. Benchmarks1. StrategyHow well matched: stakeholdervalues/mission2. OperationsWhat pace: discovery, engagement, asking3. BehaviorWhat priority: on big opportunitiesGoalBuild capacity of each Planned Giving Officer © Executive Institutional Advancement Exchange LLC 2012 35 www.ExecIAE.com
  • 40. Suggested ResourcesGerard M. Condon, Esq and Jeffrey L. Condon, Esq, Beyond the Grave: the right way and the wrongway of leaving money to your children (and others), New York, Harper, 2001Rod Miller, “Beyond Benchmarking Institutional Advancement” in Excellence in CommunicatingOrganizational Strategy, Albany, NY: State University of New York Press, 2001 (sample@ GOOGLE)……………... Best Practices for Fundraising, The CEO Hour, WSRadio.com, 3 interview segmentshttp://tunein.com/program/?SegmentId=35465519&ProgramId=268692……………... Major Gift Strategies that Workhttp://www.slideshare.net/NonprofitWebinars/major-gift-strategies-that-work-7616568……………... Why When and How the Big Gift Campaigns Workhttp://www.slideshare.net/NonprofitWebinars/why-when-and-how-the-big-gift-campaigns-work-7285907……………... Advancement Best Practices that Workhttp://www.slideshare.net/NonprofitWebinars/advancement-best-practices © Executive Institutional Advancement Exchange LLC 2012 www.ExecIAE.com 36
  • 41. Find listings for our current season of webinars and register at: NonprofitWebinars.comA Service Of: Sponsored by: