Planned Giving Benefits for NonprofitsEven if you feel that starting a planned giving program is intimidating, it will be worth the work. Let me use these three benefits to explain why.
Benefit #1: Forces a Future FocusA planned gift is a future gift. A donor will not consider donating a planned gift if your nonprofit does not have a long and healthy future ahead of itself. Even just thinking about implementing a planned giving program puts nonprofits in a position where they need to step up and figure out their futures. Taking stock of your organization’s current growth direction should always be welcome. It takes great effort and strategic use of resources to run a successful nonprofit. Sometimes it is easy to get lost in the present. Nonprofits are juggling so many things at once that forecasting what is to come does not always attract much attention. Launching a planned giving program will give your organization no choice. Your fundraisers that will be soliciting planned gifts have to be able to answer questions about the future of the organization if supporters ask them.
Benefit #2: Planned Gifts are Often Some of the Largest Gifts a Nonprofit Will Receive all YearWho does not love a major gift? One major gift can change the entire course of a nonprofit’s service initiative. They are highly sought after for a reason. The only downside to major gifts is that they are scarce. We all know a variation on the famous statistic, 90% of a nonprofit’s funds come from 10% of its donors. That statistic tells us two key trends:
- Major gifts can make or break a nonprofit’s fundraising.
- Nonprofits would see considerable increases in their funding if they could just find more major gifts donors
Benefit #3: Loyal Donors Can Contribute More Than They Could Have in Their LifetimesPlanned giving benefit #3 is related to something mentioned in the above point. Wealth is not a limiting factor for planned gifts. There are donors across the country who want to give major-gift-sized donations, but do not have the flexibility in their budgets to do so. Planned giving works around that. Take a donor who has given a series of small gifts for years. The donor comes to events that you host, volunteers to make calls during phonathons, and is always actively praising your nonprofit on social media. That same donor can allocate a gift in her will that leaves her money to your organization when she no longer needs it. In many ways, planned giving is a major gifts equalizer.
Planned Giving Benefits for DonorsNow you see why planned giving is such a good idea for nonprofits, let’s delve into why donors would be interested in participating.
Benefit #1: Noticeable Tax AdvantagesThis benefit is just practical. Donors who go the planned giving route get income and capital gains tax relief, depending on the specifics of the planned gift they allocate. It is win-win-win-win.
- Win 1: the donor gets to make a charitable contribution
- Win 2: the nonprofit gets to strengthen the relationship with that donor
- Win 3: the donor gets a tax break for the gift
- Win 4: the nonprofit secures funding