Posted August 1st, 2012

Four Back-to-Basics Rules for Success

Despite tremendous changes and advances over the last several decades, it seems the more things change, the more things stay the same. This is particularly true in the area of planned and major gift development. As a result, much may be gained by looking to the past as you consider your gift development plans.

Consider these realities as you set your priorities for the remainder of this year and beyond:

1. Non-tax motivations will continue as the prime motivators for making large gifts.

We of course need to be familiar with federal and state tax law and how it affects the overall giving climate and attractiveness of specific gift methods. But we also need to remember that tax changes come and go while people’s deeper motivations for making gifts remain constant.

From a practical standpoint, nonprofits that base their marketing on more fundamental motivations and shared values will not risk having their strategy outdated with each session of Congress. The tax benefits are the icing—not the cake. It is a mistake to overemphasize them, it is also a mistake to ignore them. In the final analysis, however, few are interested in “icing” if there is no “cake.”

As donative intent is the prime motivator, it is best to focus less on marketing of gift planning techniques as tax-planning techniques and place the primary emphasis on the gift element of the “gift plan.”

2. Gift planners will increasingly call on professional advisors to supplement their skills.

After the broad outlines of a plan are in place, gift planners will in many cases need to call on the services of increasingly knowledgeable allied professionals in the fields of law, accounting, investments and other areas.

This division of labor has two advantages: First, the gift planning professional who is skilled in communications necessary to help a donor explore his or her desires and emotions may not be oriented toward the technical details.

Second, the donor should seek counsel from his or her own advisor. Any conflict of interest is eliminated when the financial development executive acts as facilitator of the gift planning process, not as the technician who completes documentation of the plan and advises on the tax consequences.

3. The roles of development staff members specializing in planned and major gift development will have to be integrated more than ever.

Those who work closely with major donors with special needs that must be addressed in order to complete a gift will need to know when to call on a colleague who may know more about which gift option may suit a particular donor. This will especially be true when working with an older, wealthy donor population. For this reason it is vital to work on teamwork that is essential to success.

4. Wills, bequests and gifts via life insurance and retirement plans will continue to be a promising source of gifts.

Many marketing programs will go “back to basics,” as charitable bequests and similar testamentary gifts appeal to the broadest number of donors. Bequest income from individuals continues to grow each year for many nonprofits. (See the July Give & Take recap of 2011 Giving USA figures.) The organizations that are seeking those funds will be the ones that receive them.

Bequest marketing can open a dialogue with charitably motivated people who may benefit from other gift arrangements discovered through the charitable estate planning process.

Remember the basics

With a number of unknowns on the horizon, now is not a time to abandon tried and true methods developed over many decades. Experience has shown that the most successful programs in times of change have been those that have stayed with basic approaches that have stood the test of time, while adjusting and evolving to meet the nuances of the current environment. Today, as in the past, those who work for organizations they believe in and that focus their efforts on working with individuals who are also passionate about their organization’s mission will continue to prosper despite the continual winds of change.

The publisher of Give & Take is not engaged in rendering legal or tax advisory service. For advice and assistance in specific cases, the services of your own counsel should be obtained. Articles in Give & Take may generally be reprinted for distribution to board members and staff of nonprofit institutions and other non-donor groups. Proper credit must be given. Call for details.

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