Posted November 1st, 2008

Tips for Turbulent Times

Consider taking the following practical steps to meet the challenges of the current environment:

1. Refine your case statement to focus on needs that are most relevant in today’s environment and make a compelling case for why you need funding. Make sure a donor understands how her/his gift will have an immediate impact.

2. Place more emphasis on “making the thank” than “making an ask” with those donors who have been most loyal over time. A competent “thank” may be more effective than an “ask” in some situations and may actually result in greater additional giving.

3. Be prepared to help donors make gifts using the most appropriate property and timing. Many older donors still own securities, real estate, and other property that reflect significant increases in value and they may be well-served from a tax and financial planning perspective to make gifts using these assets.

4. Focus on the use of charitable lead trusts, term-of-years charitable remainder trusts, and other planning vehicles that produce immediate or very near term funding from relatively younger donors. Organizations that do not have staff dedicated to planned giving should be prepared to work more closely with donors and their advisors when examining these options.

Despite indications of greater importance in challenging economic times, bequests and other planned gifts that result in funding only at the death of one or more persons will not necessarily be a “magic bullet.” It may be best to focus bequest and other planned gift efforts on the oldest among your constituency. Remember that a 70-year-old has a life expectancy of more than 15 years.

If looking to conserve scarce budget dollars, focusing resources on the 70-and-older donor group may be best. There will be time to focus on encouraging eventual bequests from today’s 50-70-year-olds later because their ultimate gifts are not expected actuarially until perhaps 2020 to 2040 or later.

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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