The 8 Characteristics of a Successful Planned Giving Program

1. Senior leadership understands what planned giving is and what having a planned giving program entails.

A successful program begins with sufficient support from the top. Members of the leadership team need to be acquainted with the fundamentals of planned giving. These include:

Motivational factors – why and how donors make gifts.
Appropriate roles played by the board, staff, volunteers, and donor advisors.
Real metrics to judge success – what results the charity might expect and over what time frame.

Senior leaders must then be willing to devote the attention and resources necessary to establish the program and make it thrive.

Ideally, several members will be knowledgeable and enthusiastic enough to become “champions” for planned giving. That is to say, they will be able to make the case for planned giving to the charity’s governing board. Ideally, the board will lead by example. Moreover, leadership will take active responsibility to assure a long-term commitment to planned giving, and ensure that others will keep the planned giving torch burning brightly, at the board level and throughout the organization.

Key Success Factors:

Educated, committed leaders.
Board members with a personal desire to see planned giving flourish.
An enduring commitment to planned giving at all levels of the organization.

2. The program has a well-defined and appropriate scope.

With input from key staff members, the charity should weigh the options available and then be realistic about the program scope the charity can initiate and sustain in the years to come. Planned giving programs that dazzle at first but fizzle shortly thereafter are an unfortunate waste of time and money.

Program guidelines should credit outright, irrevocable, and revocable gifts in three categories. These generous counting policies level the playing field for all sorts of commitments, including revocable intentions. Depending on what seems suitable, it can be far preferable for a program to start off slowly, perhaps with little more than a focus on bequests and other revocable deferred gifts, yet be poised for growth over time or at least able to mark time during difficult periods. Indeed, if a charity is beginning from nothing, it is quite likely that no money attributable to a focused planned giving effort will be received for five years or longer after the effort has been launched. We advised one client to increase the focus of its marketing efforts on estate gifts and away from life income gifts, since bequests are where donor wealth is concentrated. While the assets under management for life income gifts look impressive, revocable intentions increase overall planned giving revenue more than life income gifts.

In short, much will depend on how long the charity has been in existence, what type of work it does, and the circumstances of its donors in terms of their age, level of wealth, and history of commitment to the organization. Even with no effort at all, most charities will receive occasional bequests. Still, the objective in carrying out a planned giving program is to affirmatively reach out to donors to increase their likelihood to make a planned gift.

Key Success Factors:

A reasonable scope of activities that considers budget and staffing limitations.
Proper expectations about the timeline from promotion of planned gifts to fruition.
Goals that reflect the organization and its donors.

Bequest-intentions-and-planned-giving

3. The program has adopted suitable program policies and guidelines.

At least with respect to gift acceptance policies, which are at the heart of a planned giving program, three essential questions must be answered:

What kinds of assets are acceptable?
In what ways can gifts be structured?
What purposes can be served by gifts?

Good policies will identify gifts that will always be acceptable, those that are never acceptable, and those that may be acceptable under certain circumstances. With regard to this last category, to some extent the policies will also set forth the criteria to be employed in deciding, although beyond a point they will instead simply define processes that are to be followed by the charity in conducting due diligence before accepting a gift.

Related matters of policy, for example, will be whether the charity is willing to be the trustee of charitable trusts, whether it will seek and accept gifts for endowment, and who has what authority in what situations. Indeed, the organization may well wish to state definitively how questions are to be answered in some instances yet delineate how discretion may be applied in others.

Key Success Factors:

Comprehensive policies that address gift acceptance.
As appropriate, additional policies regarding matters such as endowment.
Awareness among fundraising staff regarding their roles and responsibilities

4. Ensure those responsible for operating the program have developed and implemented sound procedures for seeking, receiving, and administering planned gifts.

To their detriment, some charities fail to distinguish between policies, which are the prerogative (and duty) of the board to declare, and procedures, which are properly the realm of staff activity. Boards that mire themselves in matters of procedure risk engaging in counterproductive micromanagement. Though procedures will draw upon the policies, they should be developed by those responsible for operating the program in consultation with other relevant members of the charity’s staff. Moreover, neither policies nor procedures should recite what the law already requires. At the policy level, even a statement such as “The ABC Charity’s planned giving program shall be operated in compliance with all applicable federal, state, and local laws” is unnecessary, as such compliance should be assumed. Likewise, procedures should be concerned not so much with what the charity is legally obligated to do, as with how it will go about doing it.

Obviously, there are numerous details associated with operating a planned giving program. On the one hand, there are definitely best practices to be incorporated or, if nothing else, considered. Nevertheless, each charity needs to be realistic about what makes sense for the organization, its donors, and various third parties, such as service providers and donor advisors. The point is that the charity needs to be systematic and thorough in addressing what has to be done – and then actually do it!

Key Success Factors:

Recognition of the distinction between policies and procedures.
Procedures that are sound and practical.
Adherence to what has been adopted.

5. Create, follow, and refine a comprehensive marketing plan.

A planned giving program can easily become stalled when marketing is sporadic or inconsistent. A charity needs a multi-year, multifaceted plan with one or more marketing activities in process at all times. Some techniques will produce the desired results, whereas others will not - market testing and focus groups can help identify and enhance the ones that work. To the extent possible, a charity should engage in open dialogue with its existing donors about their motivations for making a planned gift to that particular organization, as well as what marketing from that organization was particularly compelling to them.

The best marketing plans are strategic in nature, meaning that individual marketing tactics are very specifically intended to work together and harmonize with other tactics. For this reason, a year-end gift annuity direct mail appeal should be considered a tactic, whereas a larger plan that targets that same audience with a mailing in the spring and considers this audience when promoting gift annuities in the organization’s newsletter could be called strategic. Even though good marketing plans will tend to have some elements in common, numerous characteristics of a particular charity and its donors make it imperative that the charity tailor its plan to the nature and objectives of its planned giving program, as well as to the resources at its disposal. In addition, coordinate marketing and messaging among planned giving and other development marketing. The most successful marketing programs are those in which planned giving is woven into the charity’s overall development efforts, resulting in a cohesive fundraising messaging strategy.

Key Success Factors:

A comprehensive marketing strategy from which tactical execution flows.
Consistent, coordinated organizational messaging.
Consultation with existing donors as to which marketing messages and tactics they find most appealing.

Planned-Giving-Marketing-Matters

6. The principles of the program support the ability of donors to meet their objectives.

That a planned giving program must be donor friendly is an understatement. Every program must focus on donor needs and wishes. A donor friendly program focuses on the donor’s desire to express philanthropic interests, not the charity’s need for support. Finding the intersection between donor interests and the needs of the charity is the point of successful cultivation of prospects by development staff.

Naturally, this means treating donors with appropriate courtesy and respect, especially when it comes to learning what they want to accomplish and providing them and their advisors with the information and time they need to make choices to carry out their philanthropic intent. Moreover, it means adopting an ethic of stewardship in honoring them and their gifts once those gifts have been made. Stewardship is more than polite acknowledgement. It means showing donors
the significance of their giving and how it strengthens the charity, and effective stewardship enables them to visualize how the gift will benefit the charity for years to come.

Key Success Factors:

Genuine respect for each donor’s unique situation.
A primary focus on donor intent and the organization’s mission, rather than its financial needs.
Conscientious stewardship that reinforces the connection between donors and their gifts

7. Review all aspects of the program and adjust when necessary.

Regardless of whether a planned giving program is of recent vintage or has been in existence for decades, those in charge of the program need to be alert to opportunities for innovation. Similarly, there is wisdom in periodically taking a fresh look at the way things have been done to see if the time has come to abandon some practices, revise others, or revisit some facet of the program that perhaps may have outlived its usefulness. A successful program is dynamic - not simply responsive, but proactive. A charity’s board or executive staff should participate in the effort to update policies, procedures, and marketing activity.

Key Success Factors:

A willingness to embrace innovation.
The discipline to regularly evaluate the workings of the program.
An ability to discern what to retain and what to replace.

8. Fundraisers have to fundraise.

Planned giving programs can become complex operations, but the most effective programs never lose sight of the fact that fundraising must stay front and center. Some planned gifts involve complicated structures that require staff to properly complete the gifts. There are always obligatory functions to execute: conduct marketing, administer estates, complete reporting, and track state-by-state regulations and compliance. Too often we encounter clients that let administrative functions crowd out the fundraising side of their planned giving programs. Keeping fundraisers focused on fundraising needs to be the top priority. A healthy planned giving program must be staffed appropriately so that fundraisers can spend the majority of their time cultivating donor relationships and soliciting gifts knowing that closed gifts are administered effectively. It may seem obvious, but preserving fundraising staff time for fundraising is crucial. This can be difficult when planned giving requires a very specific expertise, but delegate supporting functions, such as gift administration and marketing, to other staff or have them outsourced to preserve the fundraiser’s bandwidth for their primary responsibility: raising money.

Key Success Factors:

Fundraising is the top priority of the program.
Gift administration and marketing tasks are the primary responsibility of other staff or outsourced as needed.
Fundraisers spend the majority of their time fundraising and working with donors.