The role of planned giving in a campaign

Mike Poston
Mike Poston

Michael Poston and Kate Hood

Over lo these 37 years of raising money for higher education, one thing is clear: Regardless of the size, age or clientele of an institution, when economic times throw donor confidence on the rocks, donors look for a way to hold their assets close without losing the essential element of control.

All of us want to control the different elements of our lives, including where our income will come from in the future.

Donors, more and more, are not going to let loose of cash. They want to reassure themselves that they have power over some element of their income.

Therefore, planned giving is essential in any philanthropic offering to a donor, including a capital campaign.

Since my earliest days in philanthropy, the planned-giving basics of gifts from estates and trusts have added immensely to any campaign.

Therefore, every development officer must have a working knowledge of what gift planning is, and should understand the simple definitions of charitable gift annuities, annuity trusts, unitrusts, lead trusts, bequests and life estates in residence, as well as gifts of insurance and pension plans.

Having an essential array of planned-gift instruments that you may offer an individual is key.

These instruments can allow a donor to keep the earning power of the asset and take a tax deduction, potentially get a portion of their income back tax-free, all while giving away their asset, making the charitable gift, receiving benefits and getting an income for the rest of their life.

This can be in the form of a charitable gift annuity, an annuity trust or a charitable unitrust. Or a gift could be in the form of a simple will bequest.

More and more, it can be in the form of a life estate in their home, in which the donor remains in the home but gives it away and gets a tax benefit for doing so.

And what I’ve learned is that the individual who is driving donations at most charitable organizations doesn’t need to know the technical side of how these instruments produce their income.

But they do need to know the essence of what that instrument is, how it works, and whether the organization is using a reputable investment company and has a credible track record in using the life-income instruments being offered.

Donors want credibility, reputation and forward reliability.

That is what we as officers of philanthropy can provide, as well as trust and faith that a donor’s future dollars will make a difference in our organizations.

We at Guilford College, for example, offer our alumni, friends and donors the perspective that no matter the type of planned-gift instrument, no matter the type of life-income instrument, the donor is investing in a young person’s future.

Some organizations and their boards of directors diminish the role and value of a planned gift.

That is a mistake.

Through planned giving, an individual who cannot otherwise afford an outright gift may be able – at some point – to put your organization in their will or help fund a charitable gift annuity.

It is paying life forward, if you will, that a planned gift offers people. It is essential. It is elemental to every philanthropic program.

Michael Poston is vice president for advancement at Guildford College in Greensboro, N.C. Kate Hood is assistant to the vice president for advancement.

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