objections to planned giving

Gift planning, planned giving, legacy gifts … no matter what terms your organization uses to define gifts received as part of an estate settlement, there’s often objections to planned giving and trepidation surrounding these. This may lead fundraisers to shy away from discussing the opportunity with donors. 

However, this decision could cost your organization. In the next two decades, Baby Boomers will transfer an estimated $30 trillion in wealth. While these donors are considering plans for their assets to plan for family needs, they are also likely considering how to leave a mark on the organizations and causes which have been meaningful during their lifetimes.

So, you’ve decided you are going to press on. You know the long-term success of your organization depends on it. You ask a donor if they have considered your organization as part of their legacy.

And then, the objections might begin. It’s enough to make fundraisers not even want to pose the question! But, objections often CAN be overcome.

First, a little about why the decision to make a legacy give can be difficult. Dr. Russell James has conducted extensive research on the psychology of bequest giving. In summary, this type of philanthropy and how it is discussed engages the parts of the brain related to death and dying. Thinking about what you will do with your estate means acknowledging you won’t live forever. It requires maximum sensitivity.

Here’s a few situations you might encounter when discussing legacy gifts with donors and suggestions on how to address objections to planned giving:

Why should I consider an estate gift? I’m not wealthy.

Gift planning is for anyone! We all have assets and they will go somewhere after our life. If you make a plan, you’ll have control over where they will be dispersed. Wouldn’t you rather have a say in where they will go and what they will accomplish?

Another approach: Gifts of all sizes help accomplish our mission. You could consider a small gift amount or even 1 percent of your total assets to make an impact.

I have family I want to leave my assets to, so why would I consider an estate gift?

Absolutely, you should make arrangements for your family’s needs! We are not asking you to leave your family out of your plans. Once you’ve decided what’s appropriate for your family members, we would love it if you think of your favorite charities as extension of family and make provisions for them as a legacy as well.

Bonus approach: Did you know there are assets that are more advantageous to leave individuals and some to charities? This opens the door for conversations beyond bequests and into retirement assets and insurance policies. With the changes in the United States last year with the SECURE Act becoming law, retirement assets passed to many individuals must now be completely withdrawn within 10 years (thus ending the “Stretch IRA” in many cases to be withdrawn over an inherited party’s lifetime). Therefore, retirement assets may be more financially attractive to gift to a nonprofit, which does not pay income tax on the distributions. 

But won’t creating an estate gift be expensive? Or complicated?

It depends what type of estate gift you are considering. For example, naming a beneficiary on an IRA is no cost and often can be done online through your financial organization.

Future changes to wills could be accomplished via a codicil, and it is highly recommended to consult with an attorney on this matter. Another way to accomplish changes to a bequest gift without additional legal expense to the donor is to have them reference a gift agreement with your organization in the bequest. In the future, if the purpose of the future gift changes, this agreement can more easily changed at no cost during the donor’s lifetime.

It is important to know what types of gifts your organization will accept; reference your gift acceptance policy. For example, not all organizations are licensed to manage Charitable Gift Annuities and may need to refer donors to a community foundation or financial institution to establish this type of gift with your organization as the ultimate beneficiary upon the estate settlement.

I don’t have an attorney/financial planner/accountant to assist me.

This can be a tricky situation; you want to be careful to not endorse one professional over another. If your donor has a bad experience or sensitive family relations, you want to avoid the appearance of undue influence on your donor.

One option is to recommend members of your local National Association of Charitable Gift Planners council. If you are recommending volunteers connected to your organization who work in the line of business they are seeking, provide a list of no less than three professionals so the donor may contact each and decide who is best for them. (And be sure to get your volunteers’ permission to share their contact information!)

I don’t want the publicity.

As with any gift to our organization, you may remain anonymous. If you are comfortable with sharing your story of why you chose to include us in your legacy plans, it may inspire others to give! But ultimately, the choice is yours and we will respect it.

As with any donor asks, keep in mind that “no” doesn’t always mean “never” and it is important to listen to what your donor is sharing with you as to why the answer is no. The more you listen carefully and work to address concerns, the more likely you are to establish a relationship which will last long past the donor’s lifetime.

Nonprofit Sustainability

Lisa M. Chmiola, M.S., CFRE
Lisa M. Chmiola, M.S., CFRE, has more than 18 years in philanthropic development experience. She has served in major and planned giving roles in education (public and private) and religious institutions, following initial career experience in event-based philanthropy. An AFP Master Trainer since 2014, Lisa has presented at four AFP International Conferences, and a variety of AFP and other industry association regional conferences, chapter meetings, and webinars. She also serves as an adjunct instructor in Rice University’s Center for Philanthropy and Nonprofit Leadership. As Chief Fablanthropist for Fablanthropy (the intersection of fabulous and philanthropy), she is available for consulting, training, and speaking opportunities. Lisa also is an active volunteer, serving on the board of the AFP New Orleans chapter and the U.S. Government Relations committee for AFP International, an incoming board member of the National Association of Charitable Gift Planners (and past president of the Houston chapter), a sustaining member of the Junior League, and a graduate of Leadership Houston. Additionally, she has co-authored several pieces for AFP’s Advancing Philanthropy magazine. Lisa is the proud mom of Ava, a Mini Schnauzer with her own social media presence (@avalynndog).
Lisa M. Chmiola, M.S., CFRE