Planned Giving: Helping Your Supporters Leave a Legacy With You! ANCA Summit August 22, 2013 Stan Yogi Rick Fenelli Senior Consultant Attorney at Law Klein & Roth Consulting Fenelli Law Firm
Key Points Relationships Patience Persistence No need to be an expert on planned gifts But you need to be an expert on your organizational mission
Total Private Sector Giving 2012: $316.23 Billion Individuals: $228.93 Billion (73%) Bequests: $23.41 Billion (7%) Foundations: $45.74 Billion (14%) Corporations: $18.15 Billion (6%)
Can You Afford Not to Have a Planned Giving Program? Two generations born 1901-1945 Total: 75 million Baby Boomers: Born 1946-1964 Total: 78 million Gen X: Born 1965-1980 Total: 46 million Millennials: 1981-2002 Total: 76 million
Can You Afford Not to Have a Planned Giving Program? Intergenerational transfer of wealth Over the next 20 years, 70 million baby boomers will turn 60+ By 2055, an estimated $41 trillion will go through estates
Turning Taboos on Their Heads Estate plans reflects values and priorities Estate plans help family and friends
MYTH: If a donor doesn t have an estate, they cannot or will not make a legacy gift. TRUTH: Almost everyone has some assets.
More Truths: We re all going to pass away. None of us is taking our stuff with us Everyone should have an estate plan But only 47% of adults do 8% of Americans leave an estate gift to a nonprofit Vast majority of those gifts are bequests
Before You Start, Consider: Base of donors (Ideally 100+ who have given for 3+ years) Regular contact with donors Working database Regular visits with top donors Board members making gifts Organizational leaders support
Foundation for Planned Giving Program Policies (gift acceptance, use, investment) Bequest language Case for support Leaders make gifts Legacy society Advisors
When Donors Can Contribute: Lifetime In-Between Death (Benefits Donor & Charity) 1. Transfer of Ownership 1. Trust 1. Will a. Writing a. Charitable Remainder Trust b. No writing (Income to Person 2. Trust c. Statement Remainder to non-profit) memorializing gift 3.Beneficiary b. Charitable Lead Trust Designation (Income to non-profit Remainder to Person) 4. CRT 2. Charitable Gift Annuity 5. CGA (CGA) 3. Assets that pay out over period of time (loaning benefits)
What Donors Can Contribute: Property When Deductible Stock Properly endorsed over Real Estate Deed of entire interest Accounts Receivable and Debt When collected or irrevocable Tangible personal property Delivered and Received Contract Rights Delivered and Received Patents Delivered Royalties Paid Life Insurance Policies Irrevocably transfer full ownership IRA Charitable Rollover No deduction but no tax on withdrawal Corporations Gift When Made
Nature Centers Business Horizons: Short Term Mid-Term Long-Term 1. Cash or Equivalent 2. Immediate income 3. Immediate asset to convert to cash Cash or Equivalent A. Check Letters of credit Pledges Credit cards B. Property Stock Real estate Accounts receivable Personal property Life insurance cash value 1. Income over time a. CLT b. Asset that produces stream of income Cash or Equivalent A. Promissory notes Letters of credit Pledges B. Property Real estate (payoff over period of time) Accounts receivable Contract rights Royalties Life insurance death benefit 1. Life insurance (Veteran s Life Insurance) 2. Will 3. Trust a. Living Trust b. CRT c. CLT 4. Charitable Gift Annuity
Focus on Bequests & Beneficiary Designations 90% of planned gifts are bequests or beneficiary designations Easy for donors to understand and execute Don t require expertise Easy to receive gifts
Types of Bequests Specific Bequest Percentage Bequest Residual Bequest Contingent Bequest
Spreading the Word Consistent messaging Invitation to create a planned gift embedded in all communications Encourage donors to self-identify
Segmenting Your Donors Bequests are most likely to come from long-term, small-gift donors who you may have never met Make sure that segment of your donors knows how they can include your nature center in their estate plans
Similarities Are Important Focus on building relationships Show donors appreciation Illustrate work with stories Contact donors when you don t want money Keep accurate and detailed records
Legacy Conversations: Mission & Future Vision You re obviously committed to our work... We re asking all of our longtime supporters... I m curious. Where do we fall in your priorities?
Legacy Conversations: Mission & Future Vision I ve remembered (name) in my estate.... Your annual gifts make a big difference now. Have you thought about making a difference in the future?
If a Donor Says... I ll think about it. I need to take care of my family. Will you help me find a lawyer?
Team Approach CPA Lawyer Financial Advisor Life Insurance Advisor Nature Center vs. Annie Oakleys & Wyatt Earps
When a Donor Makes a Gift Special thank you Call or visit Invitations to events Cultivate regularly
When a Gift Matures Attorney, executor, trustee Condolence / thank you letter Remove from mailing list Ticklers Check for restrictions Update family Newsletter article