If only we had a crystal ball, right?
While we can’t say with 100% clarity what 2024 will be like in planned giving, we can draw out some likely themes based on what’s happening in our industry and the world. Understanding these themes enables us to make more informed decisions to help navigate this new year.
Here are a few key challenges we’re following right now, plus our recommendations for gift vehicles to counter donor concerns.
The World’s On Our Shoulders (But Giving Is Still Good for Our Hearts)
“We need to be mindful of what is happening in the world this year.”
Wise advice as we begin any new year, but particularly important in 2024, says Stelter’s Senior Gift Planning Consultant Lynn M. Gaumer, J.D.
Issues like climate change, immigration, and conflicts around the world, will keep most of us, including your prospects and donors, feeling a bit uncertain about what will happen next.
Pair that with the higher prices and economic uncertainty at our own doorsteps, and you’ll find many checking their spending and putting some nonessentials on the back burner. This could include charitable giving. (“Everything is more expensive these days. I’m not sure I have enough to last, so how can I possibly make a gift?”)
Speak to that:
- “If there’s one thing you can count on in life, it’s change. Life’s constant changes can make it difficult to balance caring for your family and supporting the organizations that mean the most to you. There are gift opportunities that allow you to do both, no matter the circumstances.”
- Discuss strategic giving (see our suggestions below) that can help donors achieve their goals and dreams but won’t affect their current or future finances.
- Some gifts, like charitable gift annuities (CGAs), can provide older donors with dependable income during their retirement years.
- Remind them that giving is good for the soul. Research proves it. Giving is linked to happiness, health and social bonds. When donors make a planned gift, they join a community of others who share the same values.
Election Outcomes Weigh Heavily (But Don’t Define Our Legacies)
Impending elections tend to monopolize our attention and impact our pocketbook. Here in Iowa, for example, we are flooded with election ads ahead of the caucuses next week. So when talking with prospects and donors, combat the competition of an election year with this thought:
- Your organization will be around long after this next presidential administration. Presidents, administrations, congressional representatives will come and go, but your organization’s mission—and your donors’ legacies—offers the strategy and fortitude to continue the good work long after our representatives leave their platforms.
Gifts to Help Navigate the Uncertainty of 2024
In navigating the complexities of the current environment, donors have a variety of gift vehicles to consider to ensure their philanthropic goals are met. Here are a few that donors may find both meaningful and impactful in the face of prevailing challenges.
Wills/trusts and beneficiary designations. Great options for donors concerned about giving during times of uncertainty, these gifts have no impact on current finances and come to fruition after one’s lifetime.
Charitable gift annuities. Rates on CGAs are the highest they’ve been in 16 years, making CGAs a popular choice, at least for the first half of the year. Higher rates mean more income for retiring baby boomers. (And get this: Ten thousand will turn 65 every day until 2030.)
Qualified charitable distributions. With nearly $38 trillion in retirement plan assets and additional tax benefits, QCDs continue to be popular for those 70½ and older.
For your marketing consideration: Many experts agree that you should promote the benefits of QCDs three times a year: early in the year, during tax planning season and at year-end.
Appreciated stock. The Dow Jones Industrial Average hit an all-time high in December. Donating appreciated stock can be a way to increase the value of a donor’s gift. When donors give stock, they generally don’t have to pay capital gains tax and qualify for an income tax deduction for the full fair-market value. And remember that Dr. Russell James found that nonprofit organizations consistently receiving gifts of stocks or bonds grew their contributions six times faster than those receiving only cash. Learn about one nonprofit’s success story here.
A last thought: The Great Wealth Transfer is underway. A recent study projected that wealth transferred through 2045 will total $84.4 trillion—$72.6 trillion in assets will be transferred to heirs, while $11.9 trillion will be donated to charities. It’s a great time to start or grow a planned giving program.
What’s your plan for planned giving in 2024? Any other insight about what could play into prospects’ and donors’ mindsets as they consider a gift? A rising tide lifts all boats, so feel free to share your thoughts on what could work and what could cause donors to drift.