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Planned Giving Myths

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Reviewing recent research about gift planning and how it provides insights on planned giving behavior. A quick set of facts for fundraisers.

Planned Giving Myths

  1. 1. Does charitable bequest planning cannibalize current giving? “I don’t give anymore, because I have a planned charitable bequest”
  2. 2. Does charitable bequest planning cannibalize current giving?
  3. 3. Tracking the entire “lifetime” movie • Collect giving information to all charities for years before, during, and after plan changes • Large, federally-funded, longitudinal, in-person, well-compensated, nationally representative, study on health and retirement issues since 1992
  4. 4. $9,000 $8,000 $7,000 $6,000 $5,000 $4,000 $3,000 Before -8 years Before -6 years Before -4 years Before -2 years Mixed After +2 years After +4 years After +6 years After +8 years Annual Charitable Giving in Constant (Inflation Adjusted) 2012 Dollars Giving Before and After Adding Charitable Beneficiary to Estate Plan 9,439 observations from a nationally representative longitudinal study
  5. 5. $9,000 $8,000 $7,000 $6,000 $5,000 $4,000 $3,000 Before -8 years Before -6 years Before -4 years Before -2 years Mixed After +2 years After +4 years After +6 years After +8 years Annual Charitable Giving in Constant (Inflation Adjusted) 2012 Dollars Giving Before and After Adding Charitable Beneficiary to Estate Plan 9,439 observations from a nationally representative longitudinal study $7,381 average annual giving post-plan $4,210 average annual giving pre-plan +$3,171 average annual giving increase
  6. 6. Does charitable bequest planning cannibalize current giving?
  7. 7. Does charitable bequest planning cannibalize current giving?
  8. 8. Avoid technical language when first introducing a gift planning vehicle
  9. 9. Avoid technical language when first introducing a gift planning vehicle
  10. 10. Results from 10 survey groups including over 5,000 total participants collected during 2014 Please rate your interest in pursuing the following charitable giving arrangement
  11. 11. Describing a CRT Make a gift where you get an immediate tax deduction, still control the investment of the assets and receive income from the investments for the rest of your life with anything left over going to charity at your death. Make a transfer of assets where you get an immediate tax deduction, still control the investment of the assets and receive income from the investments for the rest of your life with anything left over going to charity at your death. Different groups rate their interest after receiving different descriptions Does it make much difference?
  12. 12. Transfer MGaikfet a gift where you get an immediate tax deduction, still control the investment of the 14% where you get an immediate tax deduction, still control the investment of the assets and receive income from the investments for the rest of your life with anything left over going to charity at your death. assets and receive income from the investments for the rest of your life with anything left over going to charity at your death. 54% 32% 27% 53% 20% Interested now Not now, but in future Will never be interested Make a transfer of assets 2014 Survey (A/B) 1,101 Respondents
  13. 13. Describing a CGA Make a gift and in exchange receive a guaranteed lifetime income from the charity. Enter into a contract with a charity where you transfer your cash or property and in exchange receive a guaranteed lifetime income from the charity. Does it make much difference?
  14. 14. 13% Enter into a contract with a charity where you transfer your cash or property and in exchange receive a guaranteed lifetime income from the charity 44% 44% 29% 48% 23% Interested now Not now, but in future Will never be interested Contract Gift Make a gift and in exchange receive a guaranteed lifetime income from the charity 2014 Survey (A/B) 1,101 Respondents
  15. 15. Formal terms lower charitable interest Interested Now 36% 22% Will Never Be Interested 14% 23% 2014 Survey, 1,417 Respondents, Group F/G Get an immediate tax deduction and still receive income from your investments for the rest of your life by making a gift where you control the investment of the assets, but anything left over goes to charity at your death. Get an immediate tax deduction and still receive income from your investments for the rest of your life by making a gift using a “Charitable Remainder Trust” where you control the investment of the assets, but anything left over goes to charity at your death.
  16. 16. Formal terms lower charitable interest Interested Now 50% 23% Will Never Be Interested 8% 19% 2014 Survey, 1,418 Respondents, Group F/G Receive a tax deduction and make a gift that pays you income for life Receive a tax deduction and make a gift that pays you income for life called a “Charitable Gift Annuity”
  17. 17. Formal terms lower charitable interest Interested Now 26% 15% Will Never Be Interested 23% 30% 2014 Survey, 1,422 Respondents, Group F/G Immediately receive a tax deduction for 70% of the value of a house or land by making a charitable gift of the property, but keeping the right to use it for the rest of your life. Immediately receive a tax deduction for 70% of the value of a house or land by making a charitable gift of the property, using a “Remainder Interest Deed” but keeping the right to use it for the rest of your life.
  18. 18. Formal terms lower charitable Interested Now 23% 12% Will Never Be Interested 12% 14% interest 2014 Survey, 1,246 Respondents, Groups D/E Make a gift to charity in my will Make a bequest gift to charity
  19. 19. Avoid technical language when first introducing a gift planning vehicle
  20. 20. Avoid technical language when first introducing a gift planning vehicle
  21. 21. The decision to leave an actual charitable bequest (not just a survey response) isn’t dramatically influenced by slight phrasing changes
  22. 22. The decision to leave an actual charitable bequest (not just a survey response) isn’t dramatically influenced by slight phrasing changes
  23. 23. 3,000 testators in the normal process of completing their wills were randomly assigned to one of three groups Many of our customers like to leave money to charity in their will. Are there any causes you’re passionate about? Would you like to leave any money to charity in your will? No reference to charity Cabinet Office Behavioural Insights Team (2013) Applying behavioural insights to charitable giving
  24. 24. Charitable bequests are influenced by a simple social example 5.0% 10.4% 15.4% Charitable plans among 1,000 testators Charitable plans among 1,000 testators Charitable plans among 1,000 testators Many of our customers like to leave money to charity in their will. Are there any causes you’re passionate about? Would you like to leave any money to charity in your will? No reference to charity Cabinet Office Behavioural Insights Team (2013) Applying behavioural insights to charitable giving
  25. 25. The social example also increased the average amount of bequest gifts $5,610 $5,291 Cabinet Office Behavioural Insights Team (2013) Applying behavioural insights to charitable giving $11,333 No ask Simple Ask Social Norm Using £1=$1.70 exchange rate Charitable plans among 1,000 testators Charitable plans among 1,000 testators Charitable plans among 1,000 testators
  26. 26. The social example dramatically increased total charitable dollars $280,500 Cabinet Office Behavioural Insights Team (2013) Applying behavioural insights to charitable giving $550,264 $1.75 million No ask Simple Ask Social Norm Using £1=$1.70 exchange rate among 1,000 testators among 1,000 testators among 1,000 testators
  27. 27. The social norm increased charitable bequest intentions Interested Now 30% 23% 12% Will Never Be Interested 9% 12% 14% 2014 Survey, 1,866 Respondents, Groups D/E/LateG+H Many people like to leave a gift to charity in their will. Are there any causes you would support in this way? Make a gift to charity in my will Make a bequest gift to charity
  28. 28. The decision to leave an actual charitable bequest (not just a survey response) isn’t dramatically influenced by slight phrasing changes
  29. 29. The decision to leave an actual charitable bequest isn’t dramatically influenced by slight phrasing changes
  30. 30. It is better to tell stories of living planned bequest donors than deceased bequest donors
  31. 31. It is better to tell stories of living planned bequest donors than deceased bequest donors
  32. 32. New Survey v. Instead of testing question wording, now testing impact of marketing messages for 40 national charities (4,560 participants)
  33. 33. Baseline BEQ Give Amer Cancer Society 26.79 36.77 The Red Cross 25.93 41.12 ASPCA 24.18 33.77 Habitat for Humanity 24.01 34.90 Amer Heart Association 23.17 33.95 Natl Cancer Coalition 22.56 34.54 Breast Cancer Res Fnd 22.53 33.93 Natl Breast Cancer Fnd 22.43 33.48 The Amer Humane Assn 22.23 33.91 The Alzheimer's Found 21.40 32.00 Susan G. Komen Br Canc 21.39 29.22 Dana Farber Cancer Inst 21.13 29.63 American Diabetes Assn 20.84 32.54 World Wildlife Fund 20.82 29.08 Guide Dogs for the Blind 20.80 31.46 The Alzheimer's Assn 20.80 31.86 American Lung Assn 20.78 31.40 MD Anderson Cancer Cr 20.59 30.53 UNICEF 20.37 32.31 The Salvation Army 19.98 31.44 Baseline BEQ Give Wildlife Conserv Soc 19.90 29.26 Goodwill Industries 19.65 34.42 Big Brothrs/Big Sisters 19.47 30.49 The United Way 18.97 28.97 Joslin Diabetes Center 18.91 29.18 Canine Compan for In 18.90 29.67 Fnd Fightng Blindness 18.77 28.37 AIDS Project LA 17.71 25.64 Prevent Blindss Amer 17.51 28.32 San Fran AIDS Found 17.39 25.49 Nat Audubon Society 17.33 24.24 YMCA 17.16 28.12 Boys and Girls Clubs 17.14 30.10 Girl Scouts 16.71 31.27 YWCA 16.21 24.42 Amer Indian College F 15.97 22.33 CARE 15.86 24.69 Boy Scouts 14.51 23.56 United Negro Coll Fnd 14.13 21.90 Ducks Unlimited 13.60 19.49
  34. 34. Social Norms Formal Evidence Information indicating that it is common for Americans to leave 5% or 10% to charity. Sharing survey results showing agreement with concept. Spendthrift Heirs Formal Evidence Statistics showing how rapidly heirs typically spend inheritance from published academic research Message Give- BEQ Gap Gap 50+ Gap Male Gap Female None 10.2 14.0 7.7 11.7 Spendthrift Heirs (Formal) 9.4 11.4 8.4 10.1 Social Norms (Formal) 8.8 11.7 7.5 9.7 Heirs + Social Norms 8.0 10.2 6.4 9.0
  35. 35. Charitable bequest decision making emphasizes “visualized autobiography” brain regions Contrast Brain Region MNI co-ord inates Peak p FWE Clust-er p FWE (1) Beq> Give Lingual Gyrus -2, -78, -2 .004 .000 Precuneus 26, -66, 42 .102 .009 (2) Beq> Vol Lingual Gyrus 2, -80, -4 .007 .000 Precuneus 30, -66, 40 .180 .004 Precentral Gyrus -34, -3, 36 .397 .001 (3) Beq> (Give+ Vol) Lingual Gyrus 0, -78, -4 .001 .000 Precuneus 26, -66, 42 .007 .001 James, R. N., III & O’Boyle, M. W. (2014). Charitable estate planning as visualized autobiography: An fMRI study of its neural correlates. Nonprofit and Voluntary Sector Quarterly, 43(2), 355- 373.
  36. 36. With new images or pure text (no significant difference) Deceased bequest donor life stories Message Give-Beq Gap Gap 50+ Gap Male Gap Female None 10.2 14.0 7.7 11.7 Spendthrift Heirs (Formal) 9.4 11.4 8.4 10.1 Social Norms (Formal) 8.8 11.7 7.5 9.7 Heirs + Social Norms 8.0 10.2 6.4 9.0 Deceased Beq. Stories 6.7 7.5 4.4 7.5
  37. 37. With new images or pure text (no significant difference) Living bequest donor life stories E.g., “School janitor Lester Holmes died in 1992” becomes “School janitor Lester Holmes signed his will today” Message Give-Beq Gap Gap 50+ Gap Male Gap Female None 10.2 14.0 7.7 11.7 Spendthrift Heirs (Formal) 9.4 11.4 8.4 10.1 Social Norms (Formal) 8.8 11.7 7.5 9.7 Heirs + Social Norms 8.0 10.2 6.4 9.0 Deceased Beq. Stories 6.7 7.5 4.4 7.5 Living Bequest Stories 4.4 4.3 3.3 5.0
  38. 38. With new images or pure text (no significant difference) Effect of More Stories 1st 4 Stories: Janitor, pet groomer, carpenter, symphony patron 2nd 3 Stories: fisherman, coach, physician Message Give-Beq Gap Gap 50+ Gap Male Gap Female None 10.2 14.0 7.7 11.7 Deceased 1st 4 stories 6.8 7.5 5.5 7.6 Deceased All 7 stories 6.6 7.5 5.4 7.4 Mixed Dec/Liv 7 stories 6.0 7.2 5.0 6.6 Living 1st 4 stories 4.8 5.7 3.9 5.4 Living All 7 stories 4.1 2.5 3.0 4.7
  39. 39. Which of the four message types worked best for which of the 40 charities?
  40. 40. Living donor stories outperformed all other messages for 40 out of 40 charities tested
  41. 41. Although numerical ability declines with age, verbal knowledge does not Park, et al (2002) Psychology and Aging, 17(2), 299-320
  42. 42. It is better to tell stories of living planned bequest donors than deceased bequest donors
  43. 43. It is better to tell stories of living planned bequest donors than deceased bequest donors
  44. 44. Many people increase their interest in a charitable bequest if given the option to leave a tribute bequest honoring a loved one
  45. 45. Many people increase their interest in a charitable bequest if given the option to leave a tribute bequest honoring a loved one
  46. 46. Bequests to friends and family (v. charitable bequests) more heavily involve brain regions of Emotion (mid/posterior cingulate cortex; insula) and Memory (hippocampus) Can a charitable bequest represent a loved one, and thereby connect with this memory and emotion?
  47. 47. Bequest charity representing loved ones ‘The reason I selected Help the Aged...it was after my mother died...And I just thought – she’d been in a care home for probably three or four years. And I just wanted to help the elderly...I’d also support things like Cancer Research, because people I’ve known have died...An animal charity as well, I had a couple of cats.’ “‘[In my will I have a gift to] the Cancer Research. My father died of cancer and so I have supported them ever since he died.’ Male, 89 married (Routley, 2011, p. 220-221) Female, 63 widowed
  48. 48. Testing the tribute bequest Do you have a deceased friend or deceased family member who would have appreciated your support of an International relief organization such as CARE or UNICEF? Also tested for living friend or family member Alzheimer’s The Alzheimer's Association, Blindness related nonprofit Foundation The Alzheimer's Foundation Fighting Blindness, Prevent Blindness America Diabetes Joslin Diabetes Center, The Youth-related charitable Girl Scouts, Boy American Diabetes Association Scouts, YMCA, YWCA, Big Brothers / Big Sisters of Wild Birds Preservation America, Boys and Girls Clubs of America National Audubon Society, Ducks Unlimited AIDS research and care San Francisco Wildlife AIDS Foundation, AIDS Project Los Angeles World Wildlife Fund, Wildlife Conservation Society Animal welfare Minority College Fund American Society for Prevention of Cruelty to Animals, United Negro The American Humane Association College Fund, American Indian College Fund International relief UNICEF, Care Cancer research American Cancer Society, National Cancer Coalition, M.D. Anderson Cancer Center, Dana Farber Cancer Institute Guide dogs Guide Dogs for the Blind, Canine Companions for Independence Breast cancer research Breast Cancer Research Foundation, National Breast Cancer Foundation, Susan G. Komen Breast Cancer Foundation If so, please state your relationship to them and write at least 25 words describing their interest in or connection with this cause. If you signed a will in the next 3 months, what is the likelihood you might leave a BEQUEST gift honoring a living [deceased] friend or family member to _____
  49. 49. Connection reminder + tribute bequest offer increases interest Change in charitable bequest intention for those with family/friend connection Total Age 50+ Male Female Memorial reminder +14.0 +14.0 +13.5 +14.0 Living reminder +9.2 +9.3 +7.7 +9.9 Average share with family/friend connections to each cause Total Age 50+ Male Female Memorial reminder 22.1% 27.1% 19.5% 23.6% Living reminder 34.2% 36.1% 30.4% 36.6%
  50. 50. Connection reminder + tribute bequest offer can be “stacked” with other bequest messages Change in charitable bequest intention for those with family/friend connection Total Age 50+ Male Female Memorial reminder +11.7 +12.2 +11.0 +12.1 Memorial reminder (after other messages) +15.0 +14.0 +15.3 +14.8 Living reminder +9.4 +11.3 +6.4 +10.0 Living reminder (after other messages) +9.2 +9.1 +7.9 +9.9
  51. 51. Donor stories + tribute reminder eliminates giving-bequest intention gap for those with friend/family connections Giving – Tribute Bequest Total Age 50+ Male Female Memorial reminder (after living/ deceased stories) -4.2 -1.7 -6.5 -3.1 Living reminder (after living/ deceased stories) -3.3 -2.3 -2.4 -3.7 TRIBUTE REMINDER DONOR STORY DONOR STORY DONOR STORY
  52. 52. Tribute bequests are more attractive for ascendants, less for descendants or friends Family and friend words associated with interest in a tribute bequest (ranked by strength of correlation) Positive Non-significant Negative grandmother +7.5 dad girl -12.8 family +3.5 children boy -13.7 mother +2.4 uncle kids -8.4 aunt +2.6 sister girls -12.1 grandfather +2.7 mom friends -3.5 husband +3.6 wife boys -11.6 cousin brother -6.4 parents daughter -6.1 son child -5.8 father friend -1.4
  53. 53. Phrasing the tribute question Interested Now 23% 16% 13% Will Never Be Interested 17% 21% 21% 2014 Survey, 1,961 Respondents, Groups B/A/H 1 in 4 increased their intention to leave a charitable bequest Honor a friend or family member by making a memorial gift to charity in my last will & testament Make a bequest gift to charity in my last will & testament in honor of a friend or family member who appreciated the charity's work Make a bequest gift to charity in my last will & testament in honor of a friend or family member who was passionate about the charity's work
  54. 54. Many people increase their interest in a charitable bequest if given the option to leave a tribute bequest honoring a loved one
  55. 55. Many people increase their interest if given the option to leave a tribute bequest honoring a loved one
  56. 56. Are Americans becoming much less likely to have a signed and witnessed will or trust document?
  57. 57. Are Americans becoming much less likely to have a signed and witnessed will or trust document?
  58. 58. 61% 59% 57% 55% 53% 51% 1998 (n=18,987) 2000 (n=18,142) 2002 (n=17,353) 2004 (n=17,464) 2006 (n=17,033) 2008 (n=16,280) 2010 (n=17,562) 2012 (n=17,798) 2014 (projected) U.S. 55+ population with a will or trust
  59. 59. States allowing “Transfer on Death” deeds in 1995
  60. 60. States allowing “Transfer on Death” deeds in 2000
  61. 61. States allowing “Transfer on Death” deeds in 2005
  62. 62. States allowing “Transfer on Death” deeds fall 2014
  63. 63. 55% 50% 45% 40% 35% 30% 25% 20% 15% 10% 5% Age 55+ use of will alone or trust Will Only Funded Trust
  64. 64. 11.0% 10.5% 10.0% 9.5% 9.0% 8.5% 8.0% 1998 (n=18,987) 2000 (n=18,142) 2002 (n=17,353) 2004 (n=17,464) 2006 (n=17,033) 2008 (n=16,280) 2010 (n=17,562) 2012 (n=17,798) 2014 (projected) Charitable beneficiary among those aged 55+ with a will or trust
  65. 65. 10% 8% 6% 4% 2% 0% 1998 (n=18,987) 2000 (n=18,142) 2002 (n=17,353) 2004 (n=17,464) 2006 (n=17,033) 2008 (n=16,280) 2010 (n=17,562) 2012 (n=17,798) 2014 (projected) U.S. 55+ with a charitable beneficiary
  66. 66. Are Americans becoming much less likely to have a signed and witnessed will or trust document?
  67. 67. Are Americans becoming much less likely to have a signed and witnessed will or trust document?
  68. 68. Don’t the aging demographics say we should be getting big charitable bequest dollars now? ?
  69. 69. Don’t the aging demographics say we should be getting big charitable bequest dollars now?
  70. 70. 140 120 100 80 60 40 20 0 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016 $ Billions Annually Charitable bequests: Predicted v. Received Est. High ('98-'17) Est. Middle ('98-'17) Est. Low ('98-'17) Charitable bequests received Estimated annually is 1/20 of 20 year estimated total from P.G. Schervish and J. J. Havens (1999) “Millionaires and the millenium: New estimates of the forthcoming wealth transfer and the prospects for a golden age of philanthropy”. Bequests received are inflation-adjusted numbers from Giving USA 2014
  71. 71. Wealthy people die old. Wealthy bequest donors die even older. 88 86 84 82 80 78 76 Median Age at Death Linear (Male Bequest Donor) Linear (Female Bequest Donor) Linear (All Female) Linear (All Male) “the life expectancy [of a 65-year-old female Charitable Remainder Trust Donor]… would be… nearly 10 and one-half years longer than the charitable income tax deduction table (90CM Table). Clontz & Behan, NCPP 2010
  72. 72. 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Cumulative percentage of charitable bequest dollars by donor age at death 55-59 60-64 65-69 70-74 75-79 80-84 85-89 90-94 95+ Over 80% of charitable bequest dollars come from decedents aged 80+
  73. 73. Half of all charitable bequest dollars came from decedents this age and older… Current U.S. study: Age 89 New Australian study (5% sample of national probate files): Age 90
  74. 74. 2000000 2500000 3000000 3500000 4000000 4500000 1914 (Age 100) 1917 (Age 97) 1920 (Age 94) 1923 (Age 91) 1926 (Age 88) 1929 (Age 85) 1932 (Age 82) 1935 (Age 79) 1938 (Age 76) 1941 (Age 73) 1944 (Age 70) 1947 (Age 67) 1950 (Age 64) 1953 (Age 61) 1956 (Age 58) 1959 (Age 55) 1962 (Age 52) 1965 (Age 49) 1968 (Age 46) 1971 (Age 43) 1974 (Age 40) 1977 (Age 37) 1980 (Age 34) 1983 (Age 31) The “baby bust” is driving demographics Births
  75. 75. 20,000,000 15,000,000 10,000,000 5,000,000 0 Total resident population by 5-year age groups Temporary flat trend in key population 50-54 55-59 60-64 65-69 70-74 75-79 80-84 85-89 90-94 95-99 100+ 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Key population not growing, YET
  76. 76. Don’t the aging demographics say we should be getting big charitable bequest dollars now?
  77. 77. Don’t the aging demographics say we should be getting big charitable bequest dollars now?
  78. 78. 90% of planned bequest donors never change their plans
  79. 79. 90% of planned bequest donors never change their charitable plans
  80. 80. The NCPG (2000) study showed that 90% of planned bequest donors don't change their plans Fiction Among those (avg. age of 58) WITH a charitable plan, 10% chose “Amount Decreased” when asked about their overall plan, “Has the amount of the charitable bequest ever increased or decreased?” Fact It showed that IF charity stayed in, plan changes decreased total charitable amount 10% of the time
  81. 81. Plans changes occur over time Old data Post-mortem for largest estates We can see this only in a LIFETIME survey not in a ONE TIME survey
  82. 82. The ten-year test Among those who reported a charitable plan in the initial year AND answered the same question 10 years later, what percentage still reported having a charitable plan? 1994 v. 2004; 1996 v. 2006 1998 v. 2008; 2000 v. 2010 2002 v. 2012
  83. 83. Most still report charitable plans 10 years later 70% 60% 50% 40% 30% 20% 10% 0% 10-Year Retention of Charitable Estate Component 1993/4 to 2004 1995/6 to 2006 1998 to 2008 2000 to 2010 2002 to 2012 age 70+ age 50-69
  84. 84. 85% 80% 75% 70% 65% 60% 55% 50% Charitable Plan Loss Trajectory Among those still answering the question who reported having a charitable component in BOTH 1998 & 2000 2002 2004 2006 2008 2010 2012
  85. 85. “Count it and forget it” doesn’t work!
  86. 86. 90% of planned bequest donors never change their charitable plans
  87. 87. 90% of planned bequest donors never change their charitable plans
  88. 88. Most charitable plans are added within five years of death
  89. 89. Most charitable plans are added within five years of death
  90. 90. Most realized charitable plans added within 5 years (shown in red) of death Total Number Total $
  91. 91. Although most charitable plans were added within 5 years of death, ONE longer-term plan was worth FOUR made in the last two years.
  92. 92. A 5% national sample of 2012 probate records in Australia showed an estimated • 31% of charitable wills were signed within 2 years of death • 60% were signed within 5 years of death Baker, Christopher (2014) Encouraging Charitable Bequests by Australians . Asia-Pacific Centre for Social Investment & Philanthropy - Swinburne University
  93. 93. Age at Will Signing (by share of total charitable bequest $ transferred) 13% 80s+ 76% 11% 70s pre-70 Australian data from: Baker, Christopher (October, 2013) Encouraging Charitable Bequests by Australians . Asia- Pacific Centre for Social Investment & Philanthropy - Swinburne University
  94. 94. Factors predicting when charitable plans are ADDED
  95. 95. 1. Approaching death (final pre-death survey) 2. Becoming a widow/widower 3. Diagnosed with cancer 4. Decline in self-reported health 5. Divorce 6. Diagnosed with heart problems 7. Diagnosed with a stroke 8. First grandchild 9. Increasing assets 10. Increasing charitable giving
  96. 96. Factors predicting when charitable plans are DROPPED
  97. 97. 1. Decline in self-reported health 2. Approaching death (final pre-death survey) 3. Becoming a widow/widower 4. Divorce 5. Diagnosed with cancer 6. Diagnosed with heart problems 7. Diagnosed with a stroke 8. First grandchild 9. First child 10. Exiting homeownership
  98. 98. Most charitable plans are added within five years of death
  99. 99. Most charitable plans are added within five years of death (and many are dropped)
  100. 100. More older adults (50+) are resistant to planned giving concepts than younger adults (30-50)
  101. 101. More older adults (50+) are resistant to planned giving concepts than younger adults (30-50)
  102. 102. A larger share of older adults are decidedly resistant to bequest giving and planned giving (2014 Survey) Difference in older (50+) v. all respondents Questions I Will Never Be Interested Definitely Interested Now All gift of cash +0.1% +2.4% All bequest gift +8.5% +0.6% All tribute bequest +10.1% -0.2% All TOD +13.2% -0.2% All donor advised fund +13.9% -0.2% All gift of stocks/bonds +14.3% +0.0% All retained life estate +15.9% -0.9% All CGA +16.8% -2.3% All CRT +25.2% -1.9%
  103. 103. Older adults are initially more resistant to bequest giving but more responsive to bequest marketing
  104. 104. 14 12 10 8 6 4 2 0 Give-Bequest Gap Older adults are initially more resistant to bequest giving but are more responsive to bequest giving marketing All 50+ { { { { { { { { }
  105. 105. Older adults initially more resistant to tribute bequest concept (survey #1) but more responsive to tribute bequest reminder (#2) Average share with family/friend connections to each cause Total Age 50+ Memorial reminder 22.1% 27.1% Living reminder 34.2% 36.1% Change in charitable bequest intention for those with family/friend connection Total Age 50+ Memorial reminder +13.97 +13.96 Living reminder +9.22 +9.33 Will Never Be Interested All 50+ All bequest gift 15.9% 24.4% All tribute bequest 20.3% 30.4%
  106. 106. More older adults (50+) are resistant to planned giving concepts than younger adults (30-50)
  107. 107. More older adults (50+) are resistant to planned giving concepts, BUT are also more responsive to messages
  108. 108. If you are in the signed and witnessed will, you should expect to receive a gift at death
  109. 109. If you are in the signed and witnessed will, you should expect to receive a gift at death
  110. 110. Previous data Old data Small one-time snapshots in life New data Post-mortem for largest estates The entire “lifetime” movie (tracking same people from mid-life to post-mortem)
  111. 111. Wills that won’t What ultimately happened to those written and witnessed will documents reported during life?
  112. 112. Reported wills are often unused Distributed estates where decedent reported having a written and witnessed will (n=6,063) 16% 38% 11% 10% 19% 6% No will found Will probated Unprobated will: nothing much of value Unprobated will: estate otherwise distributed Unprobated will: trust distributed Unprobated will: other
  113. 113. Funded trusts more likely to work Distributed estates where decedent reported having a 75% 4% 2% 10% 5% 4% funded trust (n=913) Funded trust exists No documents Will probated Unprobated will: Otherwise divided Will - Nothing much of value Will - Unknown
  114. 114. If you are in the signed and witnessed will, you should expect to receive a gift at death
  115. 115. If you are in the signed and witnessed will, you should expect to receive a gift at death.
  116. 116. It is important to mention tax deductions when initially describing a planned gift
  117. 117. It is important to mention tax deductions when initially describing a planned gift
  118. 118. Social Desirability Bias The motivational effects of tax benefits appear when measured directly People are unlikely to report giving as motivated by personal benefits like tax deductions
  119. 119. Mentioning tax deductions increases charitable interest Interested Now 50% 33% 31% Will Never Be Interested 8% 14% 20% 2014 Survey, 1,904 Respondents, Groups D/E/F Receive a tax deduction and make a gift that pays you income for life. Make a gift that pays you income for life and receive a tax deduction. Make a gift that pays you income for life.
  120. 120. Mentioning tax deductions increases charitable interest Interested Now 26% 12% 11% Will Never Be Interested 23% 33% 42% 2014 Survey, 1,826 Respondents, Groups F/B/D Immediately receive a tax deduction for 70% of the value of a house or land by making a charitable gift of the property, but keeping the RIGHT TO USE it for the rest of your life. Make a charitable gift of either a house or land, but keep the RIGHT TO USE for the rest of your life and immediately receive a tax deduction for 70% of the value of the property. Make a charitable gift of either a house or land, but keep the RIGHT TO USE it for the rest of your life.
  121. 121. Mentioning tax deductions increases charitable interest Interested Now 28% 27% 21% Will Never Be Interested 17% 20% 25% 2014 Survey, 1,782 Respondents, Groups E/A/C Get an immediate tax deduction by making a gift where you still control the investment of the assets, and receive income from the investments for the rest of your life with anything left over going to charity at your death. Make a gift where you get an immediate tax deduction, still control the investment of the assets and receive income from the investments for the rest of your life with anything left over going to charity at your death. Make a gift where you still control the investment of the assets, and receive income from the investments for the rest of your life with anything left over going to charity at your death.
  122. 122. It is important to mention tax deductions when initially describing a planned gift
  123. 123. It is important to mention tax deductions when initially describing a planned gift

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