Southeastern Bible College09/22/2011

Capital v Cash

Public Se-curities

Private Stock

Real Estate Bonds Cash Equivalent

$1M : $2M

16.8 8.5 18.1 8.8 7.5

$5M : $10M

23.6 15.8 15.1 12.4 4.1

$10M+ 26.4 28.3 11 12.4 2.3

2.57.5

12.517.522.527.5

Millionaires' Five Largest Asset Classes

Perc

en

tag

e o

f N

et

wo

rth

Source: Estimates from MRI database and IRS data.Assets excluded: Equity in personal residence(s); corporate bonds; foreign bonds,; net value of life insurance; savings bonds; equity in motor vehicles; collectibles; and personal property.

Capital Allocation

Disposable Income

Disposable Income = Gross Income – Personal Taxes

ie. Consumption + Saving= Disposable Income

Discretionary Income

Gross income - Taxes - Necessities=Discretionary Incomeie. AGI – Lifestyle – Dependents=Discretionary Income

Cash v. Capital Cultivation

Mission

Human

Capacity

Financial

Edifying Short-term Support…Insuring Long-term

Sustainability…

SHORT-TERM DILEMMA:CULTIVATION OF HUMAN ENDOWMENT

2 Responsibilities of Advancement:

1,000 Donors 10%/yr=1,100 Donor Households

and/or1,000 Donors @$1,100/yr=$1,100,000 Support

Attrition Rate @20%/yr

1,000 Donors 20%/yr=800 Donors

and/or$1,000,000 Support=$800,000

LONG-TERM SOLUTION:CAPITALIZATION OF HUMAN ENDOWMENT

2 Opportunities for Advancement:

Gifts of Capital

and/or

Gifts of Estates

$10,000,000 Capital @10%=$1,000,000

Institution Individual

Addressing the Market Place

Institution

Giver

Fundraising

Qualified

Limited

Wants

Individual

Investor

Service

Everyone

Complete

Win-Win

Agenda

Approach

Audience

Access

Attitude

Ask

Protection

Problems

Property

Posterity

Providence

Perceived Needs

“Where the ‘odds’ are with you.”

Stick Figures, Boxes, and Arrows