More Americans Making Bequests and Other Planned Gifts, Study Finds
By Debra E. Blum
Contributor
November 2, 2000 | Read Time: 5 minutes
By DEBRA E. BLUM
Eleven percent of Americans say they have already earmarked money for charities in their
wills or created another type of planned gift, according to a new survey.
Based on responses from 170,000 households, the survey found that another one out of four Americans is considering making such charitable bequests or gifts.
The survey was conducted by NFO Research, a market-research company in Greenwich, Conn., for the National Committee on Planned Giving, which released a report on the survey’s preliminary findings at its annual meeting last week.
A similar survey conducted in 1992 for the committee found that only 6 percent of Americans had set up bequests or other planned gifts.
Most of the new report is based on a smaller sample of households — 1,579 in all — that reported on the survey that they had either put a charitable bequest in a will or created a charitable remainder trust or gift annuity.
Influence of Advisers
One of the most significant changes over the last eight years was the growing influence of financial advisers in donors’ giving decisions. In 1992, only 4 percent of the respondents said a legal or financial adviser had suggested a bequest, and 14 percent said those advisers told them about charitable trusts. This year, those percentages rose to 21 percent and 51 percent, respectively.
The new survey found that charities, too, may be doing a better job of getting the word out about bequests and trusts. In 1992, 5 percent of the respondents said they had learned about charitable bequests through a nonprofit group’s published materials, while 13 percent said they had learned of charitable trusts that way. This year, those percentages rose to 34 percent and 26 percent, respectively.
‘People Are Listening’
“Charities have been more assertive, more articulate, and more active, and, in fact, people are listening,” said Bruce Bigelow, senior vice president for development and external relations at Hood College, in Frederick, Md., and one of the authors of the report.
Mr. Bigelow said he also found it particularly interesting that this year’s findings indicate that, as he says, “planned giving is not just an old person’s project.”
He notes that about one-third of the respondents who have created a charitable remainder trust, and more than two out of five of the respondents who have set up gifts to charity in their wills, are younger than 55.
For Mr. Bigelow, that finding suggests that “I should target my marketing to people at their 25th reunion, not just their 50th reunion. That’s counterintuitive from conventional wisdom.”
One notable similarity between the results of the 1992 and 2000 surveys is in the motivations that respondents gave for making a contribution. Top on the list in both years was the donors’ desire to support the charity and their interest in how their money would be put to use.
The National Committee on Planned Giving expects to release additional information from its survey of donors in coming weeks. A final report, containing data about bequests, trusts, and charitable gift annuities, is expected to be available by the end of the year.
To order a report when it is published, go to the committee’s Web site at http://www.ncpg.org; or contact the organization at 233 McCrea Street, Suite 400, Indianapolis 46225; (317) 269-6274; or e-mail at ncpg@iupui.edu. Each copy of the report will cost $30.
Planned Gifts: A Snapshot of Donor Trends
| Donor Demographics | ||
| Bequest | Charitable remainder trust | |
| Age | ||
| 18-34 | 3% | 6% |
| 35-44 | 14% | 10% |
| 45-54 | 26% | 18% |
| 55-64 | 22% | 20% |
| 65-74 | 20% | 23% |
| 75 or older | — | 24% |
| Mean | 58 | 62 |
| Income | ||
| Under $20,000 | 11% | 10% |
| $20,000-$34,999 | 12% | 12% |
| $35,000-$49,999 | 13% | 11% |
| $50,000-$74,999 | 22% | 16% |
| $75,000-$99,999 | 14% | 14% |
| $100,000-$124,999 | 12% | 12% |
| $125,000-$149,999 | 5% | 7% |
| $150,000-$174,999 | 4% | 4% |
| $175,000 and over | 8% | 16% |
| Median (in thousands) | $60.4 | $70.7 |
| Mean (in thousands) | $75.9 | $86.3 |
SOURCE: National Committee on Planned Giving, NFO Research Inc.
NOTE: Percentages based on data from 1,579 households that had made a planned gift.
| Charitable Remainder Trust Characteristics | |
| Fair market value when created | |
| Under $100,000 | 42% |
| $100,000-$499,999 | 32% |
| $500,000-$999,999 | 11% |
| $1,000,000 or more | 15% |
| Charitable remainder trust payout rate | |
| 5.49% or less | 18% |
| 5.50% to 6.99% | 19% |
| 7% to 7.99% | 19% |
| 8% to 9.99% | 23% |
| 10% or more | 21% |
| Type of trust | |
| Charitable remainder annuity trust | 30% |
| Charitable remainder unitrust | 48% |
| Income-only unitrust | 22% |
| Assets used to finance charitable remainder trust | |
| Publicly traded stock | 41% |
| Cash | 38% |
| Real estate | 21% |
| Tangible personal property | 15% |
| Closely held corporate stock | 9% |
| Financial asset (e.g., mutual funds, annuities, etc.) | 5% |
| Insurance | 2% |
| All others | 1% |
| No answer | 5% |
SOURCE: National Committee on Planned Giving, NFO Research Inc.
NOTE: Percentages based on data from 1,579 households that had made a planned gift.
| How Donors First Learned About Gift Options | ||||
| Charitable bequests | Charitable remainder trusts | |||
| 2000 | 1992 | 2000 | 1992* | |
| The charity through its published materials | 34% | 5% | 26% | 13% |
| A legal or financial adviser | 21% | 4% | 51% | 14% |
| Family or friends | 20% | 8% | 19% | 17% |
| The charity through an individual visit | 11% | 2% | 11% | 8% |
| A speaker at a financial-planning seminar | 8% | n/a | 17% | n/a |
| General knowlege/self | 7% | 77% | n/a | 35% |
| Another donor | 6% | n/a | 5% | n/a |
| Other | 6% | n/a | 0% | n/a |
| Don’t know/no answer | 9% | n/a | 9% | n/a |
| * 1992 figures include charitable remainder trusts, gift annuities, and other types of income-producing gifts. | ||||
SOURCE: National Committee on Planned Giving, NFO Research Inc.
NOTE: Percentages based on data from 1,579 households that had made a planned gift.
| Reasons Donors Make Planned Gifts | ||
| Charitable bequest | Charitable remainder trust | |
| Desire to support the charity | 97% | 91% |
| The ultimate use of the gift by the charity | 82% | 79% |
| Desire to reduce taxes (income or estate) | 35% | 77% |
| Long-range estate and financial-planning issues | 35% | 76% |
| Create a lasting memorial for self or loved one | 33% | 44% |
| Relationship with a representative of charity | 21% | 41% |
| Encouragement of family or friends | 13% | 32% |
| Encouragement of legal or financial advisers | 12% | 48% |
| Avoidance of tax on capital gains | — | 69% |
| Increased income | — | 52% |
SOURCE: National Committee on Planned Giving, NFO Research Inc.
NOTE: Percentages based on data from 1,579 households that had made a planned gift.
