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Does Planned Giving make sense in 2012 and beyond?“Face reality as it is, not as it was, or as you wish it to be”

~Jack Welsh

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II. Contrast traditional fundraising and modern planned giving

I. Introduction

Table of Contents

III. Two perspectives of a gift

IV. The current atmosphere

V. Planned Giving community’s reaction

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Introduction

How did we get here?

What did we expect?

How did things change?

What have we accomplished?

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Traditional fundraising contrasted with modern planned giving

Typical reasons that nonprofits avoided planned giving:

Required more resources

Required specialists

Too technical/difficult

Not mainstream or popular for smaller charities

No demand from donors

Other fundraising avenues were available

Fear that it would negatively impact immediate gifts

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Traditional fundraising contrasted with modern planned giving

Planned Giving techniques often include:

Non-cash “assets”

More complexity

More risk

Deferred gifts

Donor-centric strategies

Solution-based methods

Flexible giving that engages donors

Unlimited gifting opportunities

Long-term relationships

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Two perspectives of a gift

Benefactor (Donor)

Beneficiary (Charity)

–Moving a “benefit” from one to the other

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Donor’s perspectiveMany hats

Many responsibilities

Many passions

Standard of living

Fear

Information overload

Trust issues

Prioritizing

Two perspectives of a gift

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Charity’s Perspective

FinanceEnsuring organization has enough resourcesAccountable to multiple stakeholdersOutright gifts give us maximum flexibility, simplicity and immediacy

DevelopmentCharged with finding additional revenueAccountable to multiple stakeholdersPlanned gifts give us more to discuss with donors, deepen the relationship and promote longevity

Two perspectives of a gift

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Current atmosphere

Philanthropic resilience

Magnitude of market impact on giving

Fundamental change in donor responses to economic headwinds

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Market

Economy

Political environment

Demographic changes

Global community

Current atmosphere

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The market

Volatility + fear = cash on the sidelines

Five-year cycle: 2002 2007 2012 2017?

Deleveraging

Corporations / Individuals / Government

“Uncertainty creates paralysis. Certainty creates actions.”

Current atmosphere

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The economy

The Fiscal CliffWhat is it?

What are the possible outcomes?

What does it mean for you and your donors?

Current atmosphere

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The political environment

Current atmosphere

Issue 2013 Taxes (absent legislation)

Obama Proposal Romney Proposal

Dividends and Capital Gains Taxes

Top Rate 39.6% + 3.8% Medicare Tax

Top Rate 20% + 3.8% Medicare Tax

Top Rate 15%

Income Taxes 15%, 28%, 31%, 36%, 39.6%

10%, 15%, 25%, 28%, 36%, 39.6%

8%, 12%, 20%, 22.4%, 26.4%, 28%

Deductions Phase out rules that eliminate personal and dependent exemption deductions and many other itemized deductions

Reduce the value of itemized deductions and other tax breaks for families with income of $250k +

Plans to “broaden the base” – specifics are not available. Most likely reducing or eliminating many deductions and credits

Transfer Taxes $1 million deduction, 55% top rate

$3.5 million deduction, 45% top rate

Repeal Estate Tax

Source: CBO, SmartMoney, Thompson Reuters Research Institute of America, 2012

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Demographic changes

Greatest Generation (1900-1927)

Silent Generation (1928-1945)

Baby Boomers (1946-1964)

Gen X (1965-1980)

Millennials (1981-2000)

Current atmosphere

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The global communityHeightened awareness

Increased competition for philanthropic dollars– International foundations– “Friends of” organizations

Current atmosphere

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Planned Giving community’s reaction

What are the options given what we know today?

Recoil

Business as usual

Adapt and push forward

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Recoil

Slash or freeze planned giving budget

Emphasize traditional means of giving

Limit donor options

Potential implications

Not equipped to compete

Donors feel misunderstood

Less money

Planned Giving community’s reaction

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Business as usualContinue with status quo

Keep your head in the sand

Wait and See

Potential implicationsNot positioned for growth

Missed opportunities

Lose your place at the table

Planned Giving community’s reaction

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Adapt and push forward Recognize possibilities for growth

Position yourself for a new breed of donors

Enhance existing relationships

Potential outcome Seize the opportunity

Rebrand and Ensure Longevity

More Money

Planned Giving community’s reaction

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Closing thoughts

Does Planned Giving make sense in 2012 and beyond?

“You must be on top of change, or change will be on top of you.”

~Mark Victor Hansen

“If not planned giving, what else can be done to meet your current and future fundraising objectives and ensure the perpetuity of advancing your mission?”

~Audrey Johnson

Planned Giving community’s reaction

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Thank you

Audrey JohnsonVice President

Planned Giving Advisor

audrey.johnson@wellsfargo.com

Phone - 336-732-2987