Gift Planning in the Time of COVID-19

By Jon Tidd

I was going to discuss the differences between men and women as donors in this week’s blog. Coronavirus intervened.

Today, few if any charity gift planners are going to meet face-to-face with prospective donors. But that’s not the problem.

The problem is, as history shows, that in times of great uncertainty, prospective major donors sit on their hands. They don’t make major financial decisions. It’s human nature.

Uncertainty today:

In the 44 years I’ve been involved in charitable gift planning, I’ve not seen such a multi-dimensional mess.

How to deal with all this? One answer is to let prospective donors know [a] what your institution is doing to carry out its mission, [b] why support of your institution is important and [c] what your institution is doing to dampen the spread of coronavirus.

In my view, things here in the U.S. will return to normal. My guess is that green shoots are 6 months to a year away. When green shoots do appear, a medical response to coronavirus will be taking hold and businesses and the stock market will be heading back to normal.

In the meantime, gift planners don’t have to sit on their hands. Gift planners have two big jobs to do. The first is communicating with prospective donors about the importance of making sure their estate plans are in order. This has always been important…a key message of normalcy. The second is to plan the message to send to donors once the crisis has passed.

This second message should be thoughtful and should touch on [a] lessons learned and [b] preparing for the future.

Meantime, charities should continue to promote annual giving. Annual giving doesn’t involve deep financial thinking on the donor’s part.

Donors need to understand that during this time of uncertainty and crisis, there’s a need to keep the ship afloat.

 

Sharpe Group will continue to post helpful information for you here on our blog and on our social media sites. If this blog was shared with you and you wish to sign up, you can do so at www.SHARPEnet.com/blog.

We can be found on Facebook, Twitter and LinkedIn @sharpegroup.

We welcome questions you’d like us to address. Email us at info@SHARPEnet.com and we’ll share your question and our thoughts in this blog and on social media.

7 Reasons to Stay the Course With Gift Planning Communications

By Aviva Shiff Boedecker, Sharpe Group Senior Consultant

A big question on the minds of development officers during this Pandemic Pause is whether to go ahead with scheduled planned giving mailings. Their concerns fall into two categories:
  1. Would the mailing be in good taste?
  2. Is it safe; can germs be transmitted on paper?

I will leave the safety question to the scientists.

Those who are wondering whether to proceed with planned giving mailings generally have the following concerns:
  1. At a time when people are concerned about a serious illness, it may be considered ghoulish to communicate about plans that usually go into effect as a result of someone’s death.
  2. People are concerned about the steep decline in the stock market and the possibility of recession, and some are experiencing financial difficulties due to loss of income. It would be insensitive to ask for money now.
  3. It may be better to “get out of the way” of efforts to raise funds for immediate needs and emergency relief funds.

I encourage people to think about how and why we do planned giving marketing, and who we are communicating with. The most effective planned giving marketing is directed at an organization’s most loyal donors and intended to strengthen the organization’s relationship with them. It is about legacy gift in the long term, not persuading donors to make an immediate gift.

In most cases I would encourage planned giving officers to proceed with their scheduled mailings (although some language, such as “the markets are at an all-time high” should of course be modified) for the following reasons:
  1. A time of anxiety is an opportune time to build a bond with those who are interested in your organization.
  2. Organizations that have built an endowment or raised long-range funds are now finding themselves in a more secure financial position. A good message to give donors is “this is why our long-range funds are so important,” “we are grateful to those who have made our stability possible” and “we are continuing to encourage long-term giving for this reason.”
  3. People are at home and are likely to spend more time reviewing their mail. If they are sufficiently interested in your organization to be included in your PG mailing list, they may welcome news about it, as well as information that may be helpful to them.
  4. People tend to update their estate plans when something in their life changes or when they have specific plans (such as travel) or specific concerns (such as an illness). Some attorneys and advisors have reported that they have been inundated with requests to prepare wills, trusts and other estate planning documents on an emergency basis for clients who are nervous or ill. Organizations that maintain their planned giving mailings may have an advantage of being top-of-mind at this time.
  5. Some donors may be anxious about the stock market and its potential impact on their financial security. They may find a charitable gift annuity, that offers fixed income, a very attractive option now.
  6. Donors who find themselves unable to make their usual outright gift may be more receptive than usual to ideas for contributing to an organization that is still important to them, but in a way that will not strain their current financial situation.
  7. Organizations that are on the front lines of dealing with the situation should be expanding efforts to raise all types of funds now—both for the current crisis (especially Qualified Charitable Distributions from retirement plans) and to be prepared for the future.
While this may feel like an awkward time to be communicating about planned giving, the reality is that your donors are part of your community—and that has not changed.

 

 

Sharpe Group will continue to post helpful information for you here on our blog and on our social media sites. If this blog was shared with you and you wish to sign up, you can do so at www.SHARPEnet.com/blog.

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We welcome questions you’d like us to address. Email us at info@SHARPEnet.com and we’ll share your question and our thoughts in this blog and on social media.

Solidarity in Solitary

In times like these, we can all benefit by following the advice of Mr. Rogers. When he was scared, his mother would tell him to “look for the helpers.” We too, can look for the helpers—our nonprofits, volunteers and donors—as examples of how we can also be of service. The one thing we know is fighting this pandemic must be a community effort.

We have compiled a list of articles that highlight the tremendous amount of good that is happening despite our circumstances. Humanity is rising to the challenge, together, often being led by our nonprofit community. There is solidarity in solitary.

 

 

 

Helping Hands

Senate Unanimously Passes $2T Coronavirus Stimulus Package   (The House is expected to vote on this today!)

Communities Unite From Afar to Sew Homemade Masks, Caps for Hospitals

Koval Distillery Producing Hand Sanitizer During Coronavirus Pandemic

People Are Stocking Their Little Free Libraries With Food and Toilet Paper to Help Neighbors in Need

“Many of the makeshift pantries encourage people to pay it forward with handwritten messages like ‘Take what you need, share what you can,’ and other similar adaptations of Little Free Library’s ‘Take a book, leave a book’ motto.”

 

 

 

 

 

 

 

 

 

 

With Coronavirus, Acts of Kindness Abound in US

Old Dominick Distillery Working with Shelby County Commission to Make Hand Sanitizer, Challenged by Supply Shortage

These Good Samaritans With a 3D Printer are Saving Lives by Making New Respirator Valves for Free

Kylie Jenner Donates A Reported $1 Million To Coronavirus Relief

Mississippi Clothing Company Joins Fight Against the Spread of the Coronavirus

Fashion Designers Create Protective Masks to Curb Coronavirus Shortage

“Christian Siriano, Brandon Maxwell and Prada are among the growing number of fashion brands using their sewing skills to make masks and medical gowns during the coronavirus pandemic.”
Photo: @csiriano on Instagram

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nonprofit Efforts

Rotary Clubs Rally to Spread Kindness During Coronavirus Outbreak

Girl Scouts Set up Digital Cookie Booth to Donate Boxes to Hospital Workers Amid Coronavirus Outbreak

“’We applaud our young cookie entrepreneurs for their enterprising spirit and willingness to lead during this time of uncertainty,’ GSUSA shared in a statement with “GMA.” ‘These Girl Scouts are truly tomorrow’s business leaders, and they’re showing today’s executives what savvy looks like.’”

 

 

 

 

 

 

 

 

 

 

 

 

YMCA begins food distribution program across Shelby County

Salvation Army Setting up Shelter for Homeless With Coronavirus Symptoms

“The Salvation Army’s Angel Tree warehouse has been transformed into the Joy Center, an isolation facility, with a specific area for anyone who has tested positive for the COVID-19 virus.”

 

 

 

 

 

 

 

 

 

 

Memphis Non-profits, Small Businesses Pitching in to Meet Coronavirus Needs

Project HOPE Partners with United Airlines to Deliver Lifesaving Medical Equipment to Epicenter of Coronavirus Epidemic

 

Entertainment & Fun

Community Comes Together to Celebrate 5-year-old Girl’s Birthday with Car Parade

Penguins Take a “Field Trip” in Closed Aquarium

“Penguins at Chicago’s Shedd Aquarium went on a small “field trip” to explore the building after it closed its doors to visitors amid coronavirus fears.”
Photo: @shedd_aquarium on Twitter

 

 

 

 

 

 

 

 

 

 

 

 

 

During Quarantine, Balconies Worldwide Set the Stage for DJ Sets, Squats and Singing

Musicians Turn to Virtual Concerts to Connect With Fans During COVID-19 Outbreak

Cowboy Museum Puts Their Head of Security in Charge of Their Twitter, and His Tweets are Hilariously Wholesome

Granddaughter Shows Grandfather Through Window of Isolated Care Home That She’s Engaged

“Carly Boyd shows her grandfather, Shelton, her engagement ring through a window at the locked down Premier Living and Rehab Center in N.C.”

 

 

 

 

 

 

 

 

Tell us your good news too, and we’d love to share it with others!

At Sharpe Group, we are still here and ready to help you. Our mission says it all: Serving Those Who Serve Society.

-Your Sharpe Group Family

 

Sharpe Group will continue to post helpful information for you here on our blog and on our social media sites. If this blog was shared with you and you wish to sign up, you can do so at www.SHARPEnet.com/blog.

We can be found on FacebookTwitter and LinkedIn @sharpegroup.

We welcome questions you’d like us to address. Email us at info@SHARPEnet.com and we’ll share your question and our thoughts in this blog and on social media.

 

 

 

 

 

 

Taking the Time to Listen

As a Sharpe Group editor, one of the privileges of my job is interviewing our clients’ donors in order to write stories about their giving. I don’t usually speak in absolutes, but in this instance I will: EVERY donor I’ve ever interviewed—and there are hundreds—has a wonderful story to tell; you’ve just got to listen.

Certainly, some donors are more talkative and forthcoming with their motivations than others, but those who aren’t present a challenge to unearth the motivations that compel them to make these wonderful gifts. Oftentimes, that conversation starts with something as simple as a “thank you.”

Take, for instance, my 92-year old, recently widowed father. Spoiler alert: He’s one of those planned giving donors who hasn’t raised his hand, so the charities that are included in his estate plans don’t know they are.

In the wake of the Coronavirus and self-quarantine, my father is perfectly content staying at home. He has a grandson who is tending to his immediate needs (food, medications, etc.), he can worship with his church online, he has unlimited access to The Hallmark Channel, and he can FaceTime his granddaughter.

Overall, though, my father is lonely. After losing my mother, his day-to-day life changed dramatically. One constant and comfort for him has been that he has continued to give to charities he and my mother supported. He hasn’t adjusted his support one bit and probably won’t even in the wake of market uncertainty. Why? Because he loves each one of the charities and, most importantly, honors my mother’s memory with his support. He’s made giving a priority in his day-to-day life.

With the chaos that is going on in our world today, and the necessary isolation of older members of our population , what a wonderful opportunity to reach out and thank them for their support and take the opportunity to listen to their story. For one, your planned giving donors would love to hear from you. More importantly, this may be a great time to get to know them better and strengthen your relationship with them. This is a perfect opportunity to do that.

I can’t help but think what a wonderful opportunity for one of those charities to call my father or send him a card or an email letting him know they are thinking of him and thanking him for his support. Even better, my father has a great story to tell…now is the perfect time to listen.

 

By Ashley McHugh, Sharpe Group Senior Editor and Director of Content

 

Sharpe Group will continue to post helpful information for you here on our blog and on our social media sites. If this blog was shared with you and you wish to sign up, you can do so at www.SHARPEnet.com/blog.

We can be found on FacebookTwitter and LinkedIn @sharpegroup.

We welcome questions you’d like us to address. You can email us at info@SHARPEnet.com and we’ll share your question and our thoughts in this blog and on social media.

Communicating Hope

Sharpe Group has experienced a lot over the past 50+ years in consulting with many of the leading nonprofits on donor stewardship and planned giving. This week brings unprecedented uncertainty to the world, the markets and ultimately to the important missions that our clients devote their careers to passionately serving. With this in mind, we offer the following suggestions for communication with your donors just as we believe that our clients are much like our family:

  • Conversations will not be cancelled.
  • Relationships continue to be cultivated.
  • Our mission is not to break but to endure.
  • Reading will be at a premium.
  • Self-care continues to be of utmost importance.
  • Above all, we are not cancelling Hope.

We are choosing to be vigilant and careful, and, in many ways, this pause in our lives gives each of us a chance to be introspective about “the good” that can come from this crisis. We’ve heard the phrase “social distancing,” and it’s important to follow the experts’ advice on the physical aspects of its meaning. However, during these times it may be perceived negatively, and many will begin to experience loneliness.

I remember the days following 9/11 vividly, and what I remember most was the kindness of strangers and the “purposeful slowing down of our lifestyles.” Now is such a time that we can seize the time and opportunities to practice “introspective social interaction.” We are being required to put aside the administrative tasks of our working lives and should have time and resources to devote to cultivating the critical relationships with our donors who are just as passionate about our mission as we are.

We are hearing from many of our clients and others on their reaction to this tragic and dangerous virus, as I’m sure you are hearing from companies on their action steps. Consider communicating with your donors in the same way that you are communicating with your family—your loved ones. Sending emails, newsletters and handwritten letters and making phone calls are all ways to safely assure your donors that you care about them and update them on how your nonprofit is coping.

WE are not cancelling Hope!

 

By Bob Mims, Sharpe Group CFO and Senior Consultant

 

Sharpe Group will continue to post helpful information for you here on our blog and on our social media sites. If this blog was shared with you and you wish to sign up, you can do so at www.SHARPEnet.com/blog.

We can be found on Facebook, Twitter and LinkedIn @sharpegroup.

We welcome questions you’d like us to address. You can email us at info@SHARPEnet.com and we’ll share your question and our thoughts in this blog and on social media.

 

The Stock Market in Panic: How Bad Is It?

“Over the last seven sessions, the Dow has lost 2,271 points, or 20.1%. Since hitting an all-time high of 14,164.53 one year ago today, the Dow has lost 39.4%.”

“‘We are in a free fall right now and fundamentals have been thrown out the window,’ said Phil Orlando, chief equity market strategist at Federated Investors.”

 “Stocks have tumbled despite a series of efforts on the part of the government to unfreeze the credit markets and get money flowing through the system again.”

Are these headlines from this morning? No. These are from CNN dated October 9, 2008.

One of the best things about growing older is that it gives you perspective. Those who panicked and sold out of the last downturn, or “Great Recession,” missed something spectacular as the market experienced a rebound, up to 29,551 in February 2020.

Yes, businesses closed and people lost their jobs and houses and went bankrupt … I was there for all of it and will wear the scars just as our parents and donors did.  However, I’m going to ask that, while we take all precautions seriously and not downplay this crisis, we take a hopeful attitude. Though diligence and wisdom are necessary during the uncharted waters we are wading, this too shall pass. The important thing is we realize panic and fear can often lead to poor decisions, not good ones.

So, how do we move forward from here? We aren’t financial advisors and we can’t change the direction of the markets. We can, however, use this time to check in on our donors and see how they are doing. We can use the time we aren’t traveling to call and offer a word of encouragement and thank donors for standing with us and our organization in good times and bad. We can let them know they matter to us and our organizations, and though things are difficult today, we will get through this … together.

 

Sharpe Group will continue to post helpful information for you here on our blog and on our social media sites. If this blog was shared with you and you wish to sign up, you can do so at www.SHARPEnet.com/blog.

We can be found on Facebook, Twitter and LinkedIn @sharpegroup.

We welcome questions you’d like us to address. You can email us at info@SHARPEnet.com and we’ll share your question and our thoughts in this blog and on social media.

 

By Tom Grimm, Sharpe Group Senior Consultant

Maintaining Relationships With Donors From a Distance

The Coronavirus or COVID-19 is spreading around the world at an alarming pace. With the uncertainty of its progression, anxiety amongst all is a huge factor. Social distancing has become a popular mechanism to help limit exposure between all of us. It is important to maintain a close relationship with your donors during these uncertain times, even if that means from a distance. We all want to keep others and ourselves safe by making difficult decisions not to travel by plane, congregate in large crowds, and remain at home.

Your donors are likely taking every precaution to stay well. This means visiting donors should be put on hold for the foreseeable future to ensure their health is the utmost priority. Calling your donors to check in on them will show how much you truly care. A simple phone call can go a long way. Remember also that even if your donor isn’t sick, he or she may be feeling particularly lonely and isolated, so phone calls may be just as important to remind them they are not alone.

When it comes to reaching out to your donors, time sensitivity is key, and everyone is different. Some may talk for an hour; some may only want to talk for less than a minute. Keep that in mind when initiating the call. Be sure and leave a message if you get voicemail or an answering machine. The important thing is that your donors know you’re checking on them, even if they don’t pick up the phone.

Here are a few more tips for staying in touch with your donors, especially those who are most vulnerable at this time:

  • Send an ecard for a birthday or other occasion
  • Forward a “feel-good” article with a “Thinking of You” note
  • Invite them to try FaceTime or Skype

In addition to checking in with donors over email, FaceTime or Skype, don’t forget about regular mail. With most people staying at home, reaching out to donors through one of these channels is essential for maintaining the relationship, keeping them informed and letting them know that you are here for them during these uneasy times.

 

Sharpe Group will continue to post helpful information for you here on our blog and on our social media sites. If this blog was shared with you and you wish to sign up, you can do so at www.SHARPEnet.com/blog.

We can be found on Facebook, Twitter and LinkedIn @sharpegroup.

We welcome questions you’d like us to address. You can email us at info@SHARPEnet.com and we’ll share your question and our thoughts in this blog and on social media.

 

By Jana Lawyer, Sharpe Group Senior Consultant

Alternatives to Meeting With Prospective Donors Face-to-Face

Fundraisers meeting donors face-to-face

Dealing with prospective donors face-to-face can be key to raising major individual gifts; however, with the rising concern over the COVID-19 Coronavirus things may become more complicated. Here are some best practices and alternatives to consider.

When meeting face-to-face, practice “social distancing”. Maintain a three to six-foot distance between you and those you are meeting. To prevent the spread of COVID-19, avoid physical contact, such as handshakes. Wash your hands often and avoid touching your eyes, nose and mouth. For more tips, visit CDC or WHO websites.

If meeting with a prospective donor in person seems unwise, consider speaking with them via telephone, leaving a voicemail, or video conference. While these options are less personal than a face-to-face meeting, they can still be extremely effective.

It takes experience (or in-born knowledge) to know how to work with wealthy, older individuals. The key is draw out why the prospective donor wants to support your charity. This may be obvious. For example, he or she may have been educated by your college or well-treated by your hospital. Knowing this, however, isn’t enough. Work toward asking the donor what he or she wants to accomplish with his or her gift. Be a good listener.

Maybe you’ve done all of this already. In which case it may be time to connect your gift planning adviser with the donor’s adviser, whoever that may be. Ideally, it’s a lawyer, but it may an accountant, a broker, a financial planner, etc.

Your gift planning adviser should be experienced deeply in dealing with the type of professional adviser on whom your donor is relying for advice.

Perhaps you and your gift planning adviser can do some role playing for the benefit of your colleagues in the development and finance offices.

By Jon Tidd

For more tips, see “Seven Steps to a Successful Donor Visit.”

How I Earn a Living

In this ongoing blog, I write a fair amount about gift planning strategies. For example, the last two blog pieces were about planning strategies with PIFs. And, in real life, my only clients are charities.

But I earn my living pretty much not by crafting gift planning strategies, but by solving problems and answering questions. (The truth is, most gift planning boils down to nuts-and-bolts thinkng.)

What sorts of problems? All kinds. For example, how to make an important but relatively small change to an existing gift agreement. I advised the gift officer that the donor, who lives in NYC, could go to a lawyer and get a new gift agreement drafted (which the donor and the charity would both sign) but would pay the lawyer a large fee.

Instead, I recommended a simpler, essentially cost-free alternative: a side letter of agreement (modification), drafted and signed by the charity and sent to the donor for counter-signature.

No plaudits, please, but do recognize that problem solving requires (a) understanding the problem fully and (b) knowing the ways (if there are various ways) the problem can be solved.

What sorts of questions? All kinds. For example, whether a charity should accept an offer of $X (a modest sum) in exchange for giving up (relinquishing) its rather remote interest in a fairly large trust that had been created some years ago.

I get a lot of questions like this. They’re not questions of law. They’re policy questions. A lot of what I do is point out that some questions (a lot of questions, in fact) are policy questions. I typically get called about policy questions because someone in the charity’s food chain thinks, “This is a question for Jon Tidd.”

I generally don’t answer policy questions. With rare exceptions, it’s not my job to make policy. But I do offer analysis, and I often make recommendations as to policy in situations where policy is needed but missing.

For help with your organization’s problems and questions, contact your experienced and knowledgeable Sharpe Group Consultant.

By: Jon Tidd

The Pooled Unitrust

Last time, we looked at the total return PIF.

It turns out, IRS regs also permit a pooled unitrust. It’s a pooled income fund that makes a unitrust payout.

It works from a tax standpoint like a regular PIF with one catch. To understand the “catch”, we need to understand how a garden variety PIF works.

Let’s take the usual PIF, which pays out just its regular income, typically its dividends and interest. The PIF may realize capital gain from selling appreciated stock. The realized gain is added to principal.

The PIF pays no tax on this realized gain. Why not? Because of a special deduction, called a set-aside deduction, allowed to garden variety PIFs.

Keep in mind that unlike a CRT, a PIF is not exempt from tax. As to the income distributes to its beneficiaries, it gets what’s called a distributions deduction. So although it’s not technically exempt from tax, it’s functionally exempt from tax.

Here’s the “catch” with a PIF that makes a unitrust payout. It gets no set aside deduction for realized gains added to principal. The result is that the unitrust PIF pays tax on such gains.

Sounds bad, huh? Well, maybe not. Maybe not if the PIF trustee sells just enough appreciated stock to satisfy the PIF’s unitrust payout requirement. Any realized gains that are distributed qualify for the distributions deduction.

I find it interesting the games that can be played with a PIF.

By Jon Tidd