Posted August 1st, 2000

Largest Increase Ever in Bequests to Higher Education

According to the Voluntary Support of Education 1999 report issued this spring by the Council for Aid to Education (CAE), total reported bequests to colleges and universities increased by 23%, the largest increase in over a decade. As in the case of gift activity reported by Giving USA (see page 1), giving by bequest grew at over twice the 11% overall rate of increase in giving to higher education. The $377 million increase in the amount of bequests was the largest increase ever reported and amounts to more than the total amount of bequests left to higher education as recently as 1981 when bequests for the entire year totaled just $374 million.

Trusts, annuities, and other irrevocable deferred gifts declined 12% from 1998 to 1999 after increasing 27% and 30% in the two prior years. See the chart below for trends in bequests and other deferred gifts to higher education for the decade of the 1990s.

Note that the growth trend for both components of activities collectively known in many programs as “planned giving” has been robust and the rate of growth accelerating. Bequests and other planned gifts together accounted for just under 40% of individual gifts to higher education. This figure has increased from 27% since 1984, representing a 50% increase in the percentage of higher education individual gift income attributable to bequests and other planned gifts.

Since Giving USA does not separately report deferred gifts such as trusts and gift annuities, it is not currently possible to determine total planned giving other than bequests in America today. Trusts and other irrevocable deferred gifts are now included as part of individual gift totals, as they are completed by living individuals. Giving USA in 1999 reported, however, that IRS figures indicate a rapid increase in planned gifts other than bequests as well.

For more information on the Voluntary Support of Education report, contact CAE at (212) 661-5800 or visit their Web site at www.cae.org.

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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