Posted July 1st, 1998

In The News…

Bequest intentions revealed in Michigan survey

Researchers at Michigan State University recently studied the correlation between those persons who actually had a will and those who intended to make bequests to charity. While they found no direct trend between giving and income level, they did discover differences in particular age groups.

While only 16% of the 18- to 29-year-olds said they had drafted a will, 32% of those people said they intended to use their will to leave a charitable bequest. Half of the 60-69 age group reported having a will, but the percentage of those who planned to leave a bequest to charity dropped to 6.1%. The 70- to 79-year-olds reported that nearly 70% of them had wills. Of this group, 11.3% said they intended to donate money to charitable organizations through their will.

This survey is a good example of how people feel about their assets at different times in their lives. The young twenty-somethings, who tend to have fewer family and personal financial responsibilities, have a strong propensity for giving. They are not yet as worried about retirement or medical problems. However, though they have a strong desire to give through bequests, most young people do not have the document that would make that possible–a will–and they have life expectancies of a half century or longer.

When people reach their sixties, though half of them may have a will, many people are too worried about retirement, family obligations, and potential illnesses to bequeath what they perceive to be their much needed assets to charity.

However, there is a shift when people reach their seventies. Not only do most septuagenarians have a will, their desire to want to help a charity with a bequest increases as well. In the Michigan survey the intentions of the 70-79 age group were almost double the intentions of those in their sixties. Why? One reason may be that family obligations may be lightened because children and grandchildren become self-supporting and other dependents, such as aging parents, may no longer be living.

What does this survey mean for gift planners? These survey results underscore the importance of varying the planned gift marketing message. Younger donors need to be periodically reminded of the importance of having a will in the first place. This data proves once again that older donors, especially those in their seventies, need to be reminded less about the importance of making their first will and more about updating their will to reflect all of their current wishes, including bequests to charitable organizations that are special to them.

Source: The Chronicle of Philanthropy, June 4, 1998

Senate Approves Measure to Protect Gifts

Currently, if a donor files for bankruptcy, bankruptcy trustees may attempt to force a charitable organization to return contributions, even if the donor made the gifts as many as six years prior to filing bankruptcy. The U.S. Senate recently approved legislation that would prohibit such repayments from nonprofits unless the trustee could prove a gift was made in order to deceive creditors.

“Presently, if a debtor blows every last dollar on gambling and liquor, the trustee cannot recover the money from the casino or liquor store,” said Steven McFarland with the Center for Law and Religious Freedom at the Christian Legal Society. “But if the debtor donates that same money to his church or the Red Cross, the creditors can force payment,” he stated.

With this Senate legislation, churches and other not-for-profits would be better protected from bankruptcy courts. The House of Representatives is also considering a similar bill.

Source: The Chronicle of Philanthropy, May 21, 1998

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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