Tips for engaging your board of directors
Your organization is getting serious about fundraising—especially making sure your planned giving strategies are well underway. You know it’s important for your board of directors to understand several factors about planned giving:
What is “planned giving”?
Why is it important?
What are the types of planned gifts?
How quickly can the organization expect to see results?
What is the opportunity cost of implementing a planned giving program?
How can—and should—board members get involved?
To answer these questions, you might consider putting together a simple overview sheet for your board members, using something similar to the copy below. Better yet, use the points below as talking points during board meetings.
Planned giving 101: What our board of directors needs to know
What is “planned giving”?
A “planned gift” is simply one that does not happen immediately. For example, gifts of cash and stock are “current” gifts. A gift of real estate, a charitable remainder trust, bequest, or beneficiary designation is a planned gift. Current or planned gifts can be made to an endowment. A “legacy gift” is a type of planned gift that happens upon the donor’s death via a bequest in a will or trust, or through a beneficiary designation. To attract all types of gifts—planned or current—our organization implements stewardship strategies to build long-term relationships with donors.
Why is planned giving important?
Planned giving strategies are essential for our organization because planned gifts—especially bequests—tend to be dramatically larger than a donor’s typical annual gifts. Indeed, according to Russell James’s research, the average charitable bequest is roughly 200–300 times larger than a donor’s annual gift.
What are examples of types of planned gifts?
Planned gifts include legacy gifts made through a donor’s bequest in a will, trust, or beneficiary designation on IRAs or life insurance. Planned gifts also include charitable remainder trusts, gifts of real estate, gifts of closely-held stock, and gifts of other complex assets.
How quickly can the organization expect to see results from our planned giving strategies?
The answer is that planned giving is the long game! But that is not all bad. While planned gifts often take many years to be realized, they represent the largest and most transformational gifts a nonprofit will ever receive, making early and consistent stewardship essential. Plus, donors typically make their estate plans well before the end of life, so organizations that build relationships today are the ones written into wills and beneficiary designations tomorrow.
What is the opportunity cost of implementing a planned giving program?
Actually, there can be opportunity savings for the organization by implementing a planned giving program. Planned giving programs work best when they are not a one-off, or an “extra” thing the organization is doing. Rather, planned giving strategies that are integrated into ongoing donor stewardship activities to attract all types of gifts can actually improve overall return on investment of development resources. Indeed, donors who commit to a bequest substantially increase their annual giving, often by more than 75% compared to similar donors who have not made a bequest commitment. Planned giving commitments can lead to deeper donor engagement and greater yearly generosity, making planned giving not only a future revenue source but also a driver of increased current contributions.
How can—and should—board members get involved?
Board members can help a lot by mentioning our organization to friends and colleagues, and then passing along contact information to the staff. Board members don’t have to give an “elevator pitch” or engage in a hard sell. For example, you might simply mention how much you enjoy being on the board, offer to connect your friend or colleague with someone on the organization’s staff, and mention that the organization appreciates a wide range of support, from annual giving, to gifts of appreciated stock, to legacy giving through a will, trust, or IRA beneficiary designation. That’s it!