Powerful Planned Giving with a Shoe-String Staff and a Shoe-

String Budget!

Bryan Clontz, CFP® President, Charitable Solutions, LLC (404) 375-5496

Agenda

• Wealth Transfer Overview

• Planned Giving Defined

• Two Examples: Appreciated Stock and Charitable Gift Annuities

• Legacy Motivation of Planned Giving

• Planned Giving Prospecting 101

• Next Steps

Wealth Transfer Realities

• 1998-2052 (55 Years) Havens and Schervish Report

• Transfer Between $41-136 Trillion (Low End is 2% Growth - High End is 4% Growth)

• Charitable Bequests $6-25 Trillion

• Drivers: Asset Appreciation, Depression Era Savers, Self-Perception of Wealth, Social Capital and Legacy Goals

Current State of Planned Giving

$304 Billion; Total Individual Giving and Bequest Giving=$258.96 Billion

Bequests9%

Foundations10.9%

Corporations5.6%

Individuals74.5%

Source: Giving USA, The Annual Report on Philanthropy for the Year 2009

Charitable Remainder Trusts

Charitable Remainder Trusts/Lead Trust Value in 2009 - $125 BILLION

Charitable Gift Annuity Value in 2009 - $15-20 BILLION

Life Income Gifts Represent 10-12% of All Planned Gifts

Extrapolate to $2 Trillion!!!!!

Definition: Planned giving is a process using tax and financial planning methods allowing the donor to efficiently achieve his/her personal and charitable objectives.

• Answers: How should I give or what is the best way to give?

• Solution: Lowers the donor’s real cost of giving.

Donor: Mr. & Mrs. Boardmember

Tax Bracket: 40%Capital Gains: 20%Goal: Improve efficiency of

giving.Assumes: Cost $10/share, Value

$50/share Cash Gift

Stock Gift

Total Value $1,000 $1,400

SavingsOrdinary Tax 400

560

Capital Gains Tax 0 225

Net Cost of Gift $600 $615

Appreciated Stock or Property

Federal government effectively matches $1.40 for every $1.00 a donor contributes

• Contract providing fixed payments over 1 or 2 lives in exchange for contribution

• Obligation extends beyond original gift• Simple, One-Page Agreement Offered by Public

Charities• Existed more than 160 years in US• Bargain sale calculation:

FMV-PV Life Annuity = PV Remainder Interest (Charitable Income Tax Deduction) – Must comply with 10% rule

Charitable Gift Annuity Overview

Typical CGA Donor

• 78 Year-Old Female• $44,000• Cash or Publicly-Traded

Securities• 80-90% of all 2008 life

income gifts were CGAs

CGA

HeirsCharity

Insurance

Tax Deduction Lifetime Income

Optional for Large Gifts

Current Beneficiaries of Wealth: Heidi and John Smith

Goals: Leave their children $1,000,000 each and replace taxes whenever possible with charity

100%

76% 24% 0%

HEIRS TAX CHARITY

NEW Beneficiaries of Wealth:Heidi and John Smith

100% + INS

71% < 1% 71%

HEIRS TAX CHARITY

Social Capital:

The concept of social capital clearly reveals that you have a choice - and the power - to direct how assets you will not be allowed to keep will ultimately be distributed and used.

Involuntary Philanthropist Voluntary Philanthropist

Alwin Ernst John Rockefeller, Sr.

Estate $12,642,431 $557,905,182Tax $7,124,112 $17,124,988% Lost 56% 3%

Planned Giving Resources• Planned Giving Design Center – free articles, free technical

reports and free planned giving calculator – www.pgdc.com

• Giftlaw Pro – free articles and technical reports – www.giftlaw.com

• Planned Giving Council Members Listserve – Gift-Pl, Non-Planned Giving Council –plannedgiving@yahoogroups.com

• Debra Ashton – The Complete Guide to Planned Giving $95 at www.debraashton.com

Planned Giving Prospecting 101

• People You “Know” Have Made A Planned Gift

• Founders and Past/Current Leaders of Your Charity

• “Loyals” – Consistent Givers

• Opportunistic Development – Listen, Listen and Listen

Next Steps

• Case

• Planned Giving Committee

• Formalize Policies and Procedures

• Develop Rifle-Shot Approach Plan

• Solicit and Ask Questions

• Develop Proposals

• Consistent Drip Marketing