High Net Worth Donors Have Their Financial Affairs in Order

Who in planned giving hasn’t heard this myth before?

(If you missed the first two myths in our series, be sure to catch up: Most of Planned Giving Is Just Plain Luck and Don’t Waste Your Time on Donors Younger Than 65.) Our third and final myth is sure to be one that you’re familiar with. It sounds legitimate, but is it? I certainly don’t think so.

There is still a great deal of planned giving educational opportunities with even the wealthiest of individuals—net worth of over $2 million.

1. Show Me the Money

Surprising fact: 38% of America’s wealthiest do not feel that they have a secure financial plan for retirement*. When looking at the next level of wealth, those with a net worth of $500K to $2 million, that percentage grows to 60%.

What does this mean for our outreach?

It’s no surprise that more and more people are concerned about the possibility of outliving their wealth, but there are opportunities for us as planned giving professionals to educate, educate, educate!

Control of one’s assets and one’s philanthropy has become a bigger point of discussion; and we as fundraisers can help facilitate some of these conversations. One idea is to provide simple tools that they can utilize to get their financial affairs in order. Offering estate planning kits is a perfect example.

Read about the American Society of Civil Engineers Foundation’s success using Stelter’s Electronic Personal Estate Planning Course.

2. “Let Me Talk to My Lawyer”

Did you know that just 23% of donors with a net worth higher than $2 million would only make a planned gift after consulting with an attorney, accountant or financial advisor?* Most donors rely on personal preference when considering a charitable gift in their will.

Yet, according to Stelter’s 2013 study on the links between advisors, donors and nonprofits, 4 in 5 advisors say they are the ones who bring up the topic of planned giving with a client at least half the time.

These numbers seem contradictory. So, what do they mean for us?

First and foremost: I don’t care who’s bringing up the conversation, I’m just happy that it’s happening more than it used to! In the internet age that we live in, no doubt we’re seeing an increase of ‘self-directed’ consumers, and that’s what we’re seeing with donors. They are making more philanthropic decisions on their own than on the advice of their trusted advisor.

Don’t get me wrong, advisors play a role, sometimes a big role, and they can most definitely be a potential gatekeeper in the gift planning process. However, it’s important to reinforce—with both donors and advisors—that your organization is a good steward of donor dollars and uses the money as it was intended.

3. Make It Count

Honor and tribute gifts are trending in planned giving. The benefits of these gifts range from sentiment to avoiding capital gains taxes.

We often associate this form of giving with annual gifts, but honor and tribute gifts don’t stop there.

Leaving a planned gift in a loved one’s memory is becoming more and more popular. And more and more planned giving prospects are looking to make this special kind of gift.

Just over 28% of America’s wealthiest are interested in honoring a family member by making a planned gift.* This is the most motivating interest, as it relates to charitable gift planning, for all wealth bands; and for our $2MM+ individuals, it’s equal to their interest in saving capital gains taxes by making a gift to charity.

What would an honor/tribute campaign look like in planned giving?

Check out the San Francisco Symphony and Stelter’s “70@70” bequest campaign, built upon their Music Director’s milestone birthday.

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What have you and your organization found successful when communicating with high net worth donors?

* 2016 NMI Healthy Aging Database Study

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