Getting Your Share of $9 TRILLION

July 14, 2021      Roger Craver

The other day Bob Levy, a long-time pal and liberal co-conspirator sent along a piece from The Wall Street Journalbearing the headline Older Americans Stockpiled a Record $35 Trillion.  The Time Has Come to Give It Away.

With the promise that part of this financial torrent is likely to be unleashed in the form of gifts to charities I figured this was a fine time to share with Agitator readers yet another reminder that the treasure ship is sailing and it’s time to get on board.

For more than 30 years fundraisers have known that the greatest wealth transfer in modern history is underway as the World War II generation (those born before 1949) and more recently the Baby Boomers (those born between 1949 and 1962) near the end of life.

A few facts from the WSJ piece:

  • Americans age 70 and above, as of the end of 2021’s 1st quarter, had a net worth of nearly $35 trillion. Up 27% from 30 years ago
  • This stockpile amounts to 27% of all U.S. wealth and equals 157% of the U.S.gross domestic product (GDP) –more than double the proportion 30 years ago.

More importantly for charities:

  • Between 2018-and 2042 it’s estimated these oldsters will parcel out some $70 trillion.
  • Of that roughly $61 trillion will go to heirs–grateful and ungrateful for an average inheritance of around $212,000.
  • $9 Trillion will be given to charities.

To assist you in tapping this vast resource and knowing  the diverse band of Agitator readers have  different levels of interest and experience with planned giving here are a couple of  posts and a video.

Each item should prove valuable in helping you make the most of this generational transfer of wealth.  [ You can also find additional posts here in the Agitator Archives. ]

Death Is Our Friend

In 2007 Canadian fundraisers Fraser Green and colleague Beth McDonald shared their experience in Iceberg Philanthropy: Unlocking Extraordinary Gifts from Ordinary Donors,  a book that turned traditional planned giving on its head by showing fundraisers how very ordinary donors were making extraordinary gifts to charity in their wills through a process that employed a combination of major gift strategy and direct marketing tactics.

In 2019…with You Can’t Take it With You: The Art and Science of Legacy Fundraising. their pioneering process has been updated, tweaked, and further bolstered by 12 additional years of practice plus the additional input of the new book’s co-authors Holly Wagg (GenX),  Charlotte Field (Millennial) and of course Fraser (Baby Boomer).

If you doubt that direct response is an effective way to build a successful legacy giving program these books – particularly the 2019 edition—will make a believer out of you.

Don’t Lead With Death

A most helpful and thoughtful guide was published a year ago by planned giving experts Dr. Russell James, III and Michael Rosen.  Both have years of proven experience. Dr. James, long a popular lecturer on the subject, has authored more than 45 peer-reviewed papers.  Rosen, publishes the terrific blog,  Michael Rosen Says…, and is the author of the best-selling  Donor-Centered Planned Gift Marketing.

If you’re involved in planned gift marketing their white paper, Legacy Fundraising:  The Best of Times or the Worst of Times? Is a must read. It’ll give you a science-based context and guidance that you can—and should—put to work immediately for your own organization.

Roll the Tape

Dr. Kiki Koutmeridou, The Chief Behavioral Scientist at DonorVoice weighs in with this helpful session from DonorVoice’s 2021 Summer Series

Kiki notes that legacy giving is more than waiting for old, wealthy people to pass on and hope they included your organization in their will. It’s also a lot more than sending out a legacy giving newsletter.

People give $20 for the same reason they leave you in their will – there is a part of them connected to your mission. In the latter case, they also have Commitment to your brand.

In this video Kiki outlines how how to segment and market legacy giving to create intention, activate it and maintain it….how to deal with people with kids…the importance (or not) of age…and ways to measure the likelihood of a donor making a planned gift.

 

 

If you have questions after watching this video don’t hesitate to contact Kiki [ kkoutmeridou@thedonorvoice.com ]

 

Roger

P.S.  Dealing with Doubts About Legacy Giving in a Pandemic and Depression

Of course, no white paper,  ‘how to’ guide, or video no matter how thoughtful, is likely eliminate the endless handwringing and dithering deliberations of boards, CEOs and colleagues when it comes to debating the “should we or shouldn’t we?” be asking for legacy gifts in and around this pandemic.

Fortunately, there’s a worthy arrow for the fundraiser’s legacy quiver.  It’s a report released last July  by Rogare, the fundraising think tank, titled Ethics of legacy fundraising during emergencies.  You can download the full report here.

 

 

 

 

One response to “Getting Your Share of $9 TRILLION”

  1. Bob Hartsook says:
    July 14, 2021 at 11:37 am

    I hate these code words, “planned giving” “Legacy giving”. It is a gift in your estate that benefit the institution after you die. Virtually everyone of prospect for this gift know they are going to die. While some would disagree this gift should be in the “tool kit” of every major gift officer. My opinion is we should abolish the Planned Giving Office. The fantasy that PG professionals perpetuate is some unique knowledge they possess. When Win Smith said in an estate planning seminar that 95% of the gifts realized were from simple wills. I left the seminar and did a two tour of Memphis. If 95% are that simple, I don’t need to know any more.

    I believe in knowing your donor and the value of the gift. A large national nonprofit, that Roger you can probably guess, client of mine with a pool of over 20,000 recorded estate designations. Found of realized gifts that NPO didn’t know was coming, gift size average $42,000; of realized gifts that NPO knew of the gift, but not the value, gift size average $138,000, of realized gifts in which NPO knows and have a value, average gift was over $400,000. Actually after the study, look at median rather than average is probably more productive.

    You know in my 40 years of practice when I was in control of the ask, every major gift ask had an estate gift component. With 95% of realized estate gifts come from simple wills and trusts or insurance, you don’t need to understand all these complicate tools. If you do you can find expertise hanging around every city in America. BTW, estate gifts are not one time asks.

    No research, but next to a Domino’s Pizza Driver the busiest business in the pandemic were estate planning lawyers. Anyone of economic value checked out their estate during the pandemic. There is no question about whether to ask during Pandemic, no question ask! Great time, everyone was home, lots of thinking about estate.

    Finally remember the financial planner is not working under a legally required fiduciary relationship. Some have told us 30% of estates are changed in the last couple of weeks prior to death, unhappily perhaps as many as 20% plus take charities out entirely or change to a different charity. Way too many are manipulated by the financial planner to benefit themselves.

    Bottom line is those who stay close to their donors have the best chance of estate gift being fulfilled. Those who ignore, lose. Just had a good friend, took $5 million out of his estate for an alma mata because of the University’s foundation had too large a staff. He was helped by the Foundation rep telling him that is none of his business. Where do these people come from?

    Good message today, Roger.

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