Most established not-for-profits are already equipped to solicit and accept planned gifts. But if your nonprofit is new to planned giving and doesn’t yet understand the long-term advantages of deferred gifts, it’s a good time to get up to speed. You’ll likely need to educate donors about the advantages — for them and your organization — of this form of support.
Planned gifts typically are made using one of three methods:
Other options that might be appropriate for charitable gift- and tax-planning objectives are donor-advised funds, supporting organizations or foundations.
Of course, your nonprofit doesn’t have to accept planned gifts in all forms. If, for example, your organization is going to accept endowments (gifts that permanently restrict the principal) or contributions that temporarily restrict use, you’ll need an infrastructure that handles them.
If you haven’t already, decide what type of gifts you’ll accept. Do you want to accept donations of appreciated securities (which typically provide donors with a greater tax benefit)? If so, establish a policy for them, such as whether you’ll liquidate these assets in a certain period of time. Then, adjust your investment policy on restricted gifts and get board approval. Also make sure your accounting system is set up to receive these types of gifts.
You might start seeking planned gifts among your nonprofit’s board members. Even if they don’t make planned gifts themselves, they can be effective evangelists for your nonprofit’s mission and the benefits of planned giving.
Next, you may want to target outside resources such as financial advisors. Meet with prominent advisors in your community and explain your needs and willingness to enter into planned giving arrangements. Also develop strong relationships with local community foundations. These entities can act as intermediaries between your organization and potential donors, helping you to reduce or eliminate internal investment and infrastructure costs.
To take advantage of planned gifts, your staff and board members should be prepared to discuss them when opportunities arise. Provide training on how they work and how your organization’s policies affect what you accept. Contact us with questions.