October 15, 2010 | Read Time: 2 minutes
Fund raisers who seek bequests and other such gifts from older donors should be aware of the most common mistakes to avoid, Robert Sharpe, a Memphis fund-raising consultant, told fund raisers assembled in Orlando, Fla., at the National Conference on Philanthropic Planning yesterday.
Among them:
Failure to understand the essential nature of “planned giving.” Many times the roles and responsibilities of fund raisers can be misunderstood by the board or others. Make sure you know whether you are seeking gifts that will go to the charity now or later, Mr. Sharpe says.
Lack of focus on the range of a donor’s possible motivations. Are donors making a planned gift to get a tax deduction or to get additional income? Strong fund raisers find ways to get past those issues and build relationships between the donor and the cause, he says. And no matter what, don’t ask whether your charity is in a donor’s will, Mr. Sharpe says. Only one in five or fewer bequest donors tell charities about their plans, and donors can be offended when a fund raiser seeks proof that an organization has been included in a will. Mr. Sharpe says to treat donors like “family members,” since only loved ones, close friends, and charities are found in wills. “Remember, you are being elevated to the status of a family member,” he says.
Promoting the wrong type of gift to a donor. Before a fund raiser seeks a donation, he or she needs to know a donor’s age, gift history, income, and wealth level. The interplay of age and wealth are especially important when it comes to seeking a planned gift, Mr. Sharpe says. For example, donors in their 40s or 50s may say they are putting a charity in a will, but they may change their minds many times and may be more interested in other types of planned gifts. What’s more, he says, it’s a mistake to ignore donors who are “too old.” Large gifts typically come from older people. The average age of living donors on The Chronicle’s Philanthropy 50 list of the most-generous donors in 2009 was 75. Of the 11 bequests in the top 50 gifts, the average age of death of the donor was 92.
Ignoring the inevitable economics of a planned gift. Be wary of benchmarking progress in seeking planned gifts to appease boards or other people involved with a charity. But some rules of thumb are easy to apply: a university that lacks substantial numbers of older alumni will see little in the way of gifts from their estates. But an organization with 500,000 donors, whose average age is over 70, could expect $50-million or more a year in bequests.
*Photo provided by Tony Martignetti
