The words “planned giving” carry a heavy context that strikes fear in the hearts of fundraisers and donors. It makes sense — the gifting process seems far more complex when it happens after death. Approaching planned giving proactively can help ensure the future of nonprofits while allowing donors and prospects to understand the true value of their assets. With proper guidance, these supporters can not only make charitable gifts they did not think possible, but also alleviate stress for loved ones who are left behind.“If you don't ask, the answer is always, ‘No,’” says Consultant and Charitable Gift Planner Pamela Jones Davidson. When Davidson began working as Director of Planned Giving for Indiana University Foundation, its endowment fund sat at $475 million. Today, it exceeds $2 billion. This explosive growth occurred in part because Davidson changed the “planned gift paradigm” by talking to every donor about assets and getting in front “if and when” that prospect wanted to diversify them. Years later, this method continues to reap success. “The key lies in educating and motivating the donors and prospects who already love you about charitable gifts that will otherwise be heavily taxed to heirs,” Davidson says. “I encourage them to consider using for charitable purposes the assets that will cost their family the most to inherit.”She shares four simple planned gift ideas that prospects and donors can understand, and that all charities can successfully promote:Bequests. “Bequests take no effect until death,” Davidson says. “This ‘magic language’ must be included in a valid will or testamentary, and can express a certain asset, amount, percentage or part or all of the residue of an estate.”Beneficial designations of qualified retirement plan assets. “Retirement plans are among the most expensive for family to inherit due to potentially heavy taxation, which can be deferred but will still be incurred at some future point, even to non‐spousal heirs,” Davidson says. “Those assets do not pass by a will or trust, so it must be accomplished by a donor changing the plan's beneficiary designation to include a percentage to various charities after that donor's — and maybe spouse's — lifetime uses of the plan. People of all ages can use this technique, including board members.”Gift of real property subject to life estate or term of year. “Older individuals can deed real estate to charity by providing the gift of a primary residence, vacation home or farm,” Davidson says. “The donor/life tenant makes this gift late in life to simplify their estate and to get an actuarial income tax deduction while continuing to live there as long as they wish.”Testamentary disposition of all U.S. government savings obligations. “United States savings bonds are a good testamentary gift to charity since the donor would pay income tax if they gave bonds during their lifetime,” Davidson says. “Older individuals can cash in bonds that are no longer paying income during their lifetime and use the proceeds to fund charitable gift annuities, which usually provide a better return than certificates of deposit or when making outright gifts to charities.”Source: Pamela Jones Davidson, Consultant and Charitable Gift Planner, Davidson Gift Design, Bloomington, IN. Phone (812) 876‐8646. E‐mail: email@example.com. Website: www.giftplanners.com
Successful Fundraising – Wiley
Published: Jan 1, 2018
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