Editor’s Note: This article is adapted from a session of the popular Sharpe seminar, “An Introduction to Planned Giving.” Learn more about this and other Sharpe seminars on Page 6 or at sharpenet.com/seminars.
Whether you call it a Heritage Society, Legacy Society or a name more tied to your history or mission, you most likely have a recognition society that honors those who have provided for bequests and other planned gifts. If you don’t, it may be time to establish one.
Membership is typically offered to donors who have made a commitment through a bequest, life income gift or other planned gift arrangement. Specific benefits, such as personal mementos like lapel pins or plaques, and invitations to special events such as luncheons and seminars are often included as benefits of membership in planned gift recognition societies. Here are a few ways that nonprofits can reap rewards from creating and maintaining a planned gift recognition society.
Having a recognition society for planned gift donors lets them know you appreciate them and the gifts they have made. Donors who make planned gifts have often been regular donors over a period of time and may have grown accustomed to being a member of a particular gift recognition society based on their level of giving. Recognizing donors for their planned gifts with special, separate giving societies is an easy way to show donors they are special and continue to publicly recognize them for their forethought and generosity—even as they may be reducing the amount and frequency of their current gifts and no longer qualify for other recognition societies.
The act of making a gift as part of one’s estate planning indicates that a donor has made a long-term commitment. Maintaining a recognition society allows staff to keep in touch with planned gift donors and provides opportunities to strengthen long-standing relationships with them even if they have reduced or discontinued their current support:
Where appropriate, invite recognition society donors to an annual luncheon in their honor,
Your leadership may host a holiday reception for these special donors, or
They may be included in broader recognition events that have already been scheduled.
A planned gift recognition society can provide more continuity of contact and opportunities to meet with donors and get to know them better one-on-one. Once you learn more about your donors, you may be in a better position to help them discover other planned gift opportunities that may be of interest to them.
An organization that is inattentive to those who have provided for bequests and other planned gifts because of staff turnover, poor record keeping or other factors runs the risk of alienating these special individuals and perhaps losing their gifts altogether. Keep in mind that many planned gifts are revocable. For example, a bequest provision or retirement plan beneficiary designation is completely revocable during the donor’s lifetime, as are the remainder interests of many charitable remainder trusts.
With an effective, ongoing recognition society in place, you can reduce the risk of being removed from a donor’s estate plans. Many planned gift donors may be reaching the age at which their current giving may be decreasing. A planned gift recognition society can be key to managing the natural lifecycle of donors. The society provides a way to continue to acknowledge a donor’s past and future involvement with your institution. In addition, you may see more planned gift commitments from prospective donors when they see that existing planned gift donors—not just donors of current gifts—are treated well.
Membership in a planned gift recognition society is rarely a motivator for giving. No matter how many benefits you offer to donors through such a group, realize that few people will face mortality, change their estate plans and/or incur a legal fee simply to receive a lapel pin or certificate. As a matter of fact, experience shows that the majority of planned gift donors will never tell you of their gift during their lifetime, and a number of those who do inform you will wish to remain completely anonymous and may not want to participate in a recognition society. Studies of many programs have shown that, at the most, 20 to 30 percent of estate donors will inform you of their gift provisions in advance.
Though relatively few planned gift donors will notify you of their gifts in advance, and many of those who do tell you will not want recognition, a donor recognition society remains a vitally important tool in managing gift planning relationships. The donors who will inform you of their gift commitments and who do want membership in your recognition society are a very special group. They have set themselves apart and are demonstrating to you that they want to be more involved during their lifetime. This increased level of dedication may be the reason studies of successful planned giving efforts have also shown that bequests received from donors who notify charitable recipients in advance are typically twice the amount or more than bequests that were not known about in advance.
So while your recognition society may honor only a small group of donors, remember that this type of relationship building can help strengthen and cement long-term donor friendships, which can lead to significant additional gift income in the future.