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Planned Giving is Dead. Long Live Legacy Giving – Part 2

Ask the Experts … Or Not

Under the old paradigm, planned giving officers, especially those of us devoting 100 percent of our time to the field, needed to be experts. Many larger organizations, and even those that were not so large, had a dedicated full-time planned giving officer—with hiring priority for full-time positions given to attorneys. This approach persists whether or not the newly hired person practiced law after earning a law degree. If the attorney was practicing law, estate planning attorneys, who worked in the most closely related field, were hired. However, even practicing attorneys whose only familiarity with estate planning, and possibly planned giving, was in law school, were often hired over nonattorney candidates with a much deeper knowledge of planned gifts.

About this Series

In his three-part article series, Greg Lassonde discusses the paradigm shift from “planned giving” to “legacy giving.” As you’ll see, the implications are far more significant for fundraising success than a mere change in terminology.

In  Part 1, Greg describes the old paradigm where development offices were inwardly focused, where even the name “planned giving” looked to the organization’s interests but not to those of the organization’s supporters. He then shows the evolution in thinking about the relative value of types of gifts brought about by the paradigm shift.

In this Part 2, Greg turns to a remarkable shift by nonprofits in hiring criteria for recruitment of fund development staff who will be interfacing with supporters with the goal of facilitating legacy giving, and discusses the broadening out of staff and volunteer roles in moving the process along. He also looks at the change in thinking about identifying prospects, how leads are qualified, and how to go about asking for a legacy gift. He even discusses the new lexicon created to better describe the legacy giving paradigm.

In Part 3, Greg explains the shift in thinking about what to measure and how to measure it. He talks about the changing makeup and role of committees. He then turns his attention to the question of just who we practitioners are, professionally, in the new paradigm, and offers his perspective on needed changes to strengthen the profession.

Staff not involved in planned giving, in a best-practice scenario, made referrals to planned giving officers for anything even remotely unfamiliar, sometimes even current gifts of publicly traded securities. Planned giving staff were put on a pedestal and were often seen as the go-to people for most everything beyond gifts of cash. When we didn’t know the answer immediately, we could find it quickly.

In the legacy giving paradigm, however, it’s not about being the expert, it’s about where to go when you don’t have the answer. Even the most qualified among us lack immediate answers at times, and use other resources to obtain information. When a supporter asks a question to which we don’t have the answer, no matter how much or how little we know, we should respond, “I don’t know, but I can get back to you by tomorrow.” This inspires confidence. We learn in this scenario, and we can pass that learning on to others.

Fortunately, we operate in a highly collegial field, and it’s fairly easy to connect with others to obtain the information we need, or to be pointed in the right direction. We utilize fellow legacy gift professionals, general and major gifts officer colleagues, attorneys, accountants, and other resources, in our networks. Community foundations are also an excellent resource. Every organization should have one or more go-to people for obtaining information on legacy giving. And most should have a working relationship with a professional advisor who is paid for timely and more—detailed information when help is needed.

Who Is Involved?

Under the old paradigm—nonprofits with a full-time planned giving officer—the answer to who is involved was easy. For organizations without a dedicated position, responsibility might have been given to a major gifts officer or development director. Lacking any of these positions, planned giving was an executive director duty or, on rare occasions, was the purview of a volunteer.

The new paradigm of legacy giving offers us a much more effective approach. Who is involved? Any and all staff and volunteers who have relationships with the organization’s supporters. Also, we can more actively engage referrers, those providing names of supporters whom we should approach for a legacy gift.

Rather than automatically referring a supporter to the person wearing the legacy or gift planning hat, staff (even those outside of the development office) and volunteers who have a relationship with the supporter should make the legacy ask. In this scenario, it is almost always most effective for volunteers involved to have made their own legacy commitment to the organization. Staff, however, are not usually seen as having a lifelong connection to the organization, and can make legacy asks of others without having made their own legacy gift to the organization.

Other nonprofits should follow the lead of many in the higher education sector and make one-on-one legacy asks. However, move beyond the old planned giving paradigm and get other staff involved, too.

Staff solicitors, as paid representatives, usually have not made their own legacy commitment, and appropriately so. In fact, I’ve seen many situations where staff make a legacy gift to their employer through a beneficiary designation such as a long-term health care benefit. That gift disappears just as soon as the staff person resigns. What kind of statement does this make to legacy givers of whom, on average, 90 percent keep their commitments?

Legacy asks by volunteers are an entirely different matter when it comes to having made one’s own legacy gift. When one is a nonstaffer, being a legacy giver to the organization is almost always essential to success. This commitment is similar to a capital campaign in which we wouldn’t expect volunteers to solicit unless they have made their own major gifts. A legacy giving committee made up of such volunteers is an excellent way to promote mutual support to obtain qualified leads and legacy gifts (more below).

Who Are Legacy Prospects?

While there is a growing amount of data about the importance of legacy giving, there are two statistics about prospects which stand out above the others, and which represent tremendous opportunities. Currently seven out of ten Americans—and eight of ten Canadians—give to charity during their lifetimes. Yet fewer than one in twenty make a legacy gift to charity. The two top reasons for not doing so are 1) it never occurred to them and 2) they weren’t asked.

Under the old planned giving paradigm, “donors” was the most common answer to the question, “Who are prospects?” And it is certainly true that for the vast majority of organizations, legacy gifts have mostly come from donors. Many programs also place primary emphasis on obtaining planned gifts from major donors. And yet, for almost all organizations, donors who have not been major givers make the majority of legacy gifts both in terms of frequency and dollars. Why? Those unable to make a major gift during their lifetimes can easily do so through their estates.

This legacy giving paradigm encourages us to think more broadly right from the start about prospects: legacy gifts come from long – term supporters with a “heart connection” to the charity. Certainly donors usually make up the largest portion of legacy givers. However, volunteers, former board and staff, and community members are all among the ranks of potential legacy givers, as well. For example, here in the San Francisco Bay Area, St. Anthony Dining Room, now in its seventh decade, receives a large sum in legacy gifts annually from members of the community who are not donors or otherwise connected during their lifetimes, simply because they are well known and respected.

Legacy prospects are easily found within an organization’s database. Usually the most important element in selecting a legacy prospect is longevity. And it is never too late to improve the collection of data for your organization’s database. For example, if you haven’t historically tracked basic volunteer data, including when someone started and the frequency of volunteering, start now. Regarding donor research, rarely do you need to go outside for help in determining your legacy prospects. While doing so can be crucial for raising current major gifts in a campaign, or in other major gifts scenarios, your supporters’ connection to your organization is by far the primary factor in defining who the best prospects are for a legacy gift.

How Are Leads Qualified?

Obtaining qualified leads through communications and marketing has been, by far, the dominant method under the old planned giving paradigm. Most organizations use “free” placements of planned giving messaging in publications and other communications. Those who have funds in their budgets also send targeted print mailings, although the general trend this past decade is for fewer responses. Even with the emergence of e-communications, response usually remains on the low side. Most organizations are unable to measure response through the word “rate” on the print or electronic side, since the numbers involved are usually not statistically significant.

Legacy giving also utilizes marketing and communications for program visibility and to generate qualified leads. However, direct one-on-one legacy asks should, over time, become the primary method for obtaining legacy leads and gifts. Enlightened nonprofits, typically in higher education, have been using one-on-one solicitation for decades. However, even there, until recently, asking has mostly been only a responsibility of the planned giving officer.

Who Do You Ask, and How?

Within the old planned giving paradigm, the answer to who do you ask was that in most organizations you weren’t asking anyone. Although, again, some higher education institutions have made legacy asks routinely for decades.

For most of my own career in “planned giving” I practiced, taught, and cautioned others to not use the “S” word: solicitation. I did this from my start in the field in 1992 until 2010, a few years into my consulting practice. The thinking among many is that estate planning, and the implicitly associated topic of death, is too delicate and personal a topic to raise with supporters. In accordance with common practice as discussed above, I further suggested that colleagues in higher education and hospital settings, because of the intimacy of class reunions and patient / doctor relationships, were the exception to this rule.

Since then, I’ve changed my mind. In the new paradigm of legacy giving, the in-person legacy ask is not only important, but it is also essential. Over time, this one-on-one ask will replace traditional communications and marketing techniques as the primary source for qualified leads and confirmed gifts for most nonprofit organizations. Legacy asks should be made of preidentified “suspects” approached in a thoughtful, coordinated effort. However, before going into more detail on this, let me present some common vocabulary—jargon, if you will—that I find helpful in conversations with clients and in workshop settings as well.

Legacy Status: Terms Defined

The following internal terms are useful in speaking with colleagues about a given supporter’s connection to the organization’s legacy work. This list tracks one’s legacy giving status over the entire spectrum of connection to the organization:

  • Supporter — anyone who likes your organization; maybe they give, are members, volunteering, or help in other ways
  • Prospect — long-term supporter with a heart connection
  • Suspect — anamed prospect, individually referred, as someone to approach for a legacy ask
  • Legacy Ask — the one-on-one question, “Would you consider making a legacy gift?”
  • Qualified Lead — anyone who has “raised a hand” by responding to communications and marketing, or in response to a legacy ask
  • Confirmed Gift — a qualified lead that has: committed to a revocable gift; made an irrevocable gift; or is identified as the result of a previously unknown estate gift
  • Legacy Group Member — anyone who has accepted an organization’s invitation to join its recognition group formed to steward legacy donors
  • Stewardship — active contact, at least annually over decades, with those who have made confirmed gifts, regardless of whether or not there is a legacy group, even if one chooses not to join such a group

I’ve discussed the terms “supporter” and “prospect” sufficiently earlier in this series.

I use the word “suspect” with great caution and specificity, as the term can be unsettling when first heard. “Suspect” is an especially useful word in building a sublist of prospects that can help to coordinate your approach in making legacy asks. You “suspect” someone would be receptive to a legacy ask. Suspects are close to your organization, and you or others have a relationship with that person. Solicitors should start, and will have more success, with those they know personally. However, third-party referrals will open doors even when the solicitor does not have a direct connection to the suspect.

How do you build a suspect list? First, staff and volunteer solicitors should identify those whom they know personally. Next, ask staff, board members, and other volunteers close to your organization to look at a prospect list from your database. This is called the peer review method. Your suspect list can be several hundred or even several thousand names, and is easier for most reviewers and for you if you use an Excel spreadsheet. Ask the reviewer whether or not it is okay to use the reviewer’s name for third-party referral in a letter to the suspect. If your organization already has a legacy recognition group, seek out select members and ask them for a peer review.

There is another greatly underutilized way to build a suspect list. With most every legacy ask, whether the response is “yes” or “no,” ask the suspect for names of others to approach. About half the time you will obtain one name. On occasion, a suspect will provide several names.

To enjoy the most success with legacy asks, start with people you know personally. If you are managing the legacy ask process for others, encourage them to start with suspects they know. For those new to legacy solicitation, starting with those with whom they are most likely to enjoy success — people they already know—will help build confidence that a legacy ask can be done quite easily.

There are generally two approaches to contacting suspects, directly and through a letter to request a visit. Consider carefully which will work best in each situation.

The direct approach is usually more informal and works for those with whom you have a close relationship. This can be initiated by simply picking up the phone or sending an email, and asking the supporter to get together to talk about capacity building for the long-term needs of the organization. With an informal relationship, no letter is needed prior to phone or email contact.

The letter approach is used in a more formal setting. For whatever reason, you know that the supporter will respond better if you first send a letter. The purpose is to announce your pending contact in which you will request a visit. Obviously, you will want to follow up this letter promptly with a phone call.

Setting up a visit solely to make a legacy ask may present a time issue. If this is so, the “two-fer” can work especially well for executive directors, development staff in small or solo shops, and busy volunteers. In the “two-fer” you are already getting together with a suspect for another reason, not just to make a legacy ask. By simply adding on another five minutes to the conversation, you can lay the groundwork for making a legacy ask.

In either the formal or informal setting, when you call to secure a visit, be prepared to go immediately to a “phone visit,” or to schedule one, if the suspect doesn’t wish to meet in person. Ask to discuss and identify, over the phone if necessary, your organization’s long-term priorities and needs in strengthening its future. In this way, you can set up the conversation to make the legacy ask.

There are a few other settings where a legacy ask can be combined in a time-effective manner. These are the dual and triple asks. Both are greatly underutilized.

The dual ask is done when not in campaign mode. Sequence is important: first, make the annual ask, then the legacy ask. Donors respect that you are approaching them with one package, rather than piecemeal.

The triple ask is done in a campaign setting, sequentially, in the following order: campaign, annual, and then legacy ask. Usually, this is done in one meeting, with extensions as necessary.

Historically, a different dual ask has been promoted in capital campaigns. This was labeled “comprehensive”: first, then annual ask. Smarter shops added the legacy ask to make this approach truly comprehensive. Still, secondary literature usually used the term “comprehensive campaign” in a capital setting, thus restricting the ask to capital and annual. What’s comprehensive about this?

A bit more about how to make a legacy ask. First, it might be helpful to think of a legacy ask as “small s ” solicitation. I encourage clients, after a conversation on long-term needs and building organization capacity, to then ask the question: “Would you consider making your own legacy gift to help us build this future?” While the words may vary, the qualifier word “consider” is somewhat less direct than the ask for a capital or annual fund gift.

In making the legacy ask the objective is to begin building or expanding the number of qualified leads. Roughly half of all qualified leads will become a confirmed gift over time. The trick is the timeframe during which this occurs. Conversion to a confirmed gift can take as little as a few months or as much as several years. It all has to do with when a qualified lead updates (more often) or creates (less often) an estate plan.

When someone tells you they will consider a legacy gift, the follow – up question is something like, “If I haven’t heard back from you in ‘x’ months, may I get back in touch to see if this is something you are still considering?” By asking this question you have set up a next step and have obtained permission to make contact again.

The key point here is that securing a legacy commitment can take time. It is all about qualified leads and when they are ready to act. Plus, there is no annual fund clock ticking. You want to maintain regular contact and set up a next step each time you connect. The next connection, whether it’s in the next month, quarter, or year, can often simply be a voicemail message in which you say, “… and I’m simply following up on our last conversation to see if you are still interested, or have any questions.”

Why aren’t more charities making one-on-one legacy asks? There are many reasons for this. Many organizations only use solicitation for current gifts. Others perceive legacy giving as being too difficult. There is concern that it will take a lot of staff time. Most staff fear they will be asked questions to which they don’t know the answer. Some still think that legacy gifts are only made by the wealthy. For those who have worked through some or many of these hurdles, they may be unsure how to create support from staff and others.

What does your o rganization need to make legacy asks? First, you and others must understand why it’s important. Much has been written about this, and most organizations with any longevity have at least raised the idea of creating or reviving a legacy program. Much less often, what’s been lacking is a w illingness to talk with others. As discussed above, even when there is support for making legacy asks, the job is usually relegated to one person on staff, and rarely to volunteers.

In making legacy asks, you also need to create the ability to track moves in a database or spreadsheet, more likely both. Unfortunately, database vendors are overly focused on the technical side of gift planning, and it takes a lot of work to jerry-rig a database in order to support the making and tracking of a legacy ask. The IT infrastructure is still stuck in the old planned giving paradigm. This is also true of many moves management systems. While tracking legacy giving is similar to a moves management system for major gifts, it is also quite different since the move cycle is not annual. You need to know where in the process a supporter stands: suspect; legacy ask and result (which is a one-time only action, recorded in a field in your organization’s database ); qualified lead (including the source); confirmed gift (type); and legacy society member. My challenge to database vendors is to develop a legacy moves management system focused on securing legacy gifts and reporting on the above areas.

Greg Lassonde, CFRE

About the Contributor: Greg Lassonde, CFRE

I have been working as a legacy giving specialist since 1992 and started my consulting business in 2007. My fundraising experience since 1982 has covered the full spectrum, from direct mail to legacy giving, and most everything in between. I started working fulltime in planned giving in 1997 and received CFRE (Certified Fundraising Executive) certification in 1998.

I have worked in a variety of nonprofits from KPFA Radio to my last staff position: San Francisco Symphony. I am a past board member of the Oakland Zoo Foundation, and past board member and officer of the Association of Fundraising Professionals – Golden Gate Chapter, Northern California Planned Giving Council (chairing its 2008 and 2009 annual conferences), Youth Radio, and Development Exchange International (public radio’s training arm). I’m also a past board member of Silicon Valley Planned Giving Council.

The Corporation for Public Broadcasting awarded me the Local Radio Development Award. While working for the Pacifica Foundation at KPFA Radio I set up a model program which was one of the first comprehensive planned giving programs throughout radio broadcasting. Highlights of the program included a two-year period in which I recruited more than 80 members to the newly created Lew Hill Heritage Society. I also held 13 seminars with an average of 50 attendees for each session.

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