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Gift Planning In Campaigns V 5.0


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Gift Planning In Campaigns V 5.0

  1. 1. Gift Planning in the Campaign December 15, 2006 G10 Biotech
  2. 2. Gift Planning: Why should you care? <ul><li>There are more wealthy individuals today with significant charitable intentions than at any other time in U.S. History. 1 </li></ul><ul><li>Half of those intend to see the impact of their giving in their lifetime. 2 </li></ul><ul><li>Thanks to gift planning, many of them can see a greater impact from their giving sooner than they ever thought before. </li></ul>
  3. 3. What is Planned Giving? <ul><li>“ A planned gift is any gift of any kind for any amount given for any purpose—operations, capital expansion, or endowment—whether given currently or deferred if the assistance of a professional staff person, qualified volunteer, or the donor’s advisors is necessary to complete the gift.” </li></ul><ul><li>Robert F. Sharpe, Jr., Give and Take, Vol. 20, No. 4, March 1988. </li></ul>
  4. 4. Outlook for Future Gifts of Assets <ul><ul><li>Wall Street </li></ul></ul><ul><ul><li>Real Estate </li></ul></ul><ul><ul><li>Washington </li></ul></ul>
  5. 5. Dow Jones Industrial Average 3
  6. 6. U.S. Home Sale Prices 2006 4
  7. 7. U.S. Tax Code <ul><ul><li>Social Capital </li></ul></ul><ul><ul><ul><li>Undirected Tax </li></ul></ul></ul><ul><ul><ul><li> vs. </li></ul></ul></ul><ul><ul><ul><li>Directed Tax </li></ul></ul></ul><ul><ul><li>Income Tax </li></ul></ul><ul><ul><li>Gift and Estate Tax </li></ul></ul>
  8. 8. Boomers: The New Philanthropists? <ul><ul><li>Baby Boom Generation (Born 1945-1965) </li></ul></ul><ul><ul><li>Baby Boomers have diverse mix of assets that makes them ideal gift planning prospects. </li></ul></ul><ul><ul><li>Receiving largest generational transfer of wealth </li></ul></ul><ul><ul><li>First generation to have more retirement savings in retirement accounts, not savings accounts 5 </li></ul></ul><ul><ul><li>Have invested aggressively during stock market boom of last twenty years. </li></ul></ul>
  9. 9. What About Cornell’s Boomers? <ul><ul><li>Boomers: Graduating Classes* – 1966-1986 </li></ul></ul><ul><ul><li>55,642 </li></ul></ul><ul><ul><ul><li>1362 or 2.5% tracked as P, M or S </li></ul></ul></ul><ul><ul><ul><li>2% are gift planning donors </li></ul></ul></ul><ul><ul><li>Greatest Generation: Classes* – 1945-1965 </li></ul></ul><ul><ul><li>27,214 </li></ul></ul><ul><ul><ul><li>1070 or 4% tracked as P, M or S </li></ul></ul></ul><ul><ul><ul><li>5% are gift planning donors </li></ul></ul></ul>* undergraduate only
  10. 10. Starbucks v. Sears and Roebuck <ul><ul><li>Quid Pro Quo </li></ul></ul><ul><ul><li>Involvement </li></ul></ul><ul><ul><li>Negotiate </li></ul></ul><ul><ul><li>New Angles on Old Strategies </li></ul></ul>
  11. 11. Brokaw’s Greatest Generation <ul><ul><ul><li>World War II Generation (born 1922-1945) </li></ul></ul></ul><ul><ul><ul><ul><li>Give out of respect, honor and </li></ul></ul></ul></ul><ul><ul><ul><ul><li>debt of gratitude </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Giving gifts that “just make sense” </li></ul></ul></ul></ul>
  12. 12. Bequest Giving <ul><ul><ul><li>Bequests accounted for 6.7% of total charitable giving in the US in 2005, or $17.4 billion. 6 </li></ul></ul></ul><ul><ul><ul><li>At Cornell, bequests account for 7% * of total giving. </li></ul></ul></ul><ul><ul><ul><li>Advised bequests account for 60% of the gifts that we currently have on file. Of those on file, we don’t know what the dollar amount is for over 80% of them . </li></ul></ul></ul><ul><ul><ul><li>59% of wealthy have no charitable bequest in their will. 7 </li></ul></ul></ul><ul><ul><ul><li>11% of those who give to Cornell through their will are repeat customers in the gift planning department. </li></ul></ul></ul>* Average generated from 10 years of Realized/Matured bequests on record from fiscal year 1997-2006
  13. 13. Life Income Agreements <ul><ul><ul><li>Life income agreements account for 40% of the current planned gifts on file. </li></ul></ul></ul><ul><ul><ul><li>Over 40% of LIA donors repeat gift planning customers. </li></ul></ul></ul>
  14. 14. Wealthy-Seeing is Believing <ul><ul><ul><li>92% of affluent Americans are charitable givers 8 </li></ul></ul></ul><ul><ul><ul><li>82.6% of affluent Americans give to “give back to society” 9 </li></ul></ul></ul><ul><ul><ul><li>Today, wealth is more evenly distributed across age groups 10 : </li></ul></ul></ul><ul><ul><ul><ul><li>5% under age 30 </li></ul></ul></ul></ul><ul><ul><ul><ul><li>27% age 30-44 </li></ul></ul></ul></ul><ul><ul><ul><ul><li>53% age 45-59 </li></ul></ul></ul></ul><ul><ul><ul><ul><li>15% age 60 or older </li></ul></ul></ul></ul><ul><ul><ul><li>Knowledge of gift planning is a top 5 “personal quality” when considering what influences giving. 11 </li></ul></ul></ul><ul><ul><ul><li>“ Giving back” is more important than “leaving a legacy.” 12 </li></ul></ul></ul>
  15. 15. Putting All the Pieces in Place
  16. 16. The $1 Billion Question <ul><li>How will gift planning </li></ul><ul><li>contribute to the goal? </li></ul>
  17. 17. Historical Giving Trends 40.81% 40.81% $72.1 Jun-96 31.81% 32.80% $65.8 Jun-97 27.55% 35.58% $74.2 Jun-98 61.03% 39.89% $134.8 Jun-99 24.17% 35.54% $98.9 Jun-00 25.86% 25.00% $66.2 Jun-01 32.15% 27.75% $70.0 Jun-02 35.56% 19.51% $52.0 Jun-03 58.23% 43.78% $131.6 Jun-04 35.75% 35.70% $101.0 Jun-05 24.57% 33.68% $ 116.0 Jun-06 % of Ithaca New Gifts & Commitments % of Ithaca Cash Gift Planning Activity (in millions) Fiscal Year
  18. 18. Now vs. Later <ul><ul><ul><li>Ever-evolving role of Gift Planning in nonprofit fundraising </li></ul></ul></ul><ul><ul><ul><li>Gift planning ≠ d eferred giving </li></ul></ul></ul>
  19. 19. Campaign To Do List <ul><ul><ul><li>Highlight priorities </li></ul></ul></ul><ul><ul><ul><li>Demonstrate mission </li></ul></ul></ul><ul><ul><ul><li>Articulate need </li></ul></ul></ul><ul><ul><ul><li>Stay competitive </li></ul></ul></ul>
  20. 20. Objectives for Gift Planning <ul><li>Integrate gift planning in regular University-wide communications to alumni and friends </li></ul><ul><li>Increase gift planning visits </li></ul><ul><ul><li>FY04-390; FY05-350; FY06-350;YTD07-240 </li></ul></ul><ul><li>Create and share innovative tools and resources </li></ul><ul><li>Reach out to new audiences (e.g. consistent givers, micro-audiences, etc.) </li></ul>
  21. 21. Gift Planning Help Desk <ul><li>Gift Planning staff can collaborate on gift proposals with customized gift scenarios/ technical specs for group presentations and more. </li></ul><ul><li>Share stories / refine pitches </li></ul><ul><li>Locate resources (online and offline) </li></ul><ul><li>Support for targeted marketing to your audiences </li></ul>
  22. 22. Gift Planning and Campaign Training <ul><ul><li>January 17, 2007 : Brownbag, Noon–1:00 p.m., Cayuga Room </li></ul></ul><ul><ul><li>Integrating Gift Planning - Conversational Gift Planning </li></ul></ul><ul><ul><li>February 26, 2007 : New Staff Orientation, Time TBD, Room TBD </li></ul></ul><ul><ul><li>Gift Planning 101 </li></ul></ul><ul><ul><li>Friday, April 20, 2007 : Brown bag, Noon–1:00 p.m., Cayuga Room </li></ul></ul><ul><ul><li>Gift Planning on the Web </li></ul></ul><ul><ul><li>May 18, 2007 : Campaign Briefing, 8:30–10:00 a.m., Seneca/Tioga Rm. </li></ul></ul><ul><ul><li>Pension Protection Act 2006 </li></ul></ul><ul><ul><li>May 24, 2007 : Brown bag, Noon – 1:00 p.m., Cayuga Room </li></ul></ul><ul><ul><li>Bequests </li></ul></ul>
  23. 23. What counts: Gift Crediting FMV = Fair Market Value NPV = Net Present Value None Discount by age Discount by age Beneficiary Designation None Discount by age Discount by age Living Trust/Advised Bequest NPV of payments to CU Yrs 1-5 FMV rest of term discounted Yrs 1-5 FMV rest of term discounted Charitable Lead Trust FMV less NPV Life Inc FMV FMV Pooled Income Fund FMV less NPV Life Inc FMV FMV Charitable Gift Annuity FMV less NPV Life Inc FMV FMV Charitable Remainder Trust FMV FMV FMV Real Estate FMV Based on agreement FMV Cornell Foundation FMV FMV FMV Cash/Securities Deduction Recognition/Reunion Campaign Credit Gift Type
  24. 24. <ul><li>Not all gifts are “planned gifts” </li></ul><ul><li>… but all gifts are planned. </li></ul>
  25. 25. Notes <ul><li>Key Study Findings; Bank of American High Net-Worth Philanthropy Study, Conducted by The Center on Philanthropy at Indiana University </li></ul><ul><li>“ Wealth and Giving by the Numbers,” Paul Schervish and Andr á s Sz á nt ó, Published in Reflections: Excerpts from Wealth & Giving Forum Gatherings, Issue 2, pp. 31-49; Fall 2006 </li></ul><ul><li>Calculated using Yahoo! Finance Charts Beta;^dji;range=1d;indicator=dividend;charttype=line;crosshair=on;logscale=on;source=undefined </li></ul><ul><li>“ Home Forecast: Where the Growth Is: And Isn’t,” Money Magazine Real Estate Guide 2006; </li></ul><ul><li>Generational Wealth and Giving Quiz by Dr. Judith Nichols, question # </li></ul><ul><li>2005 Contributions By Source of Contribution, Giving USA Foundation </li></ul><ul><li>http:// =chart1.cfm&ID=xgusa1 </li></ul><ul><li>“ 59% of Affluent Have No Charitable Bequest in Their Will,” November 27, 2006; Mark L. James, MBA, JD, LL.M. (Tax): Barrons Publishing Co.,b2J3D2rT </li></ul><ul><li>Key Study Findings; Bank of American High Net-Worth Philanthropy Study, Conducted by The Center on Philanthropy at Indiana University </li></ul><ul><li>Ibid. </li></ul><ul><li>“ What the Affluent Think about giving to Healthcare,” Bentz Whaley Flessner’s Annual Survey; September 2006 </li></ul><ul><li>Ibid. </li></ul><ul><li>Key Study Findings; Bank of American High Net-Worth Philanthropy Study, Conducted by The Center on Philanthropy at Indiana University </li></ul>
  26. 26. Chip Bryce Director, Gift Planning 607-254-6147 [email_address]