How to Incorporate Planned Giving into Your Capital Campaign

Sometimes an organization is blessed with a board member, let’s call him James, who believes in the power of planned giving and decides to spearhead an effort to get people to include the organization in their wills. Including an organization in a will is one of the most common ways people make planned gifts. And when someone is redoing their will, it’s not complicated to include an organization as one of the beneficiaries.

So, when board members like James decide they want to get more people to make bequest intentions, they can be quite successful. Perhaps they will get 5 or 10 or even 20 people to put the organization in their will.

The development staff thanks and appreciates the active board member for his work. But when he passes on or retires from the board, the effort stops and recedes in importance. Some years later, when under the watch of a new Director, the organization gets a significant influx of money from the estates of people who have died. Suddenly, checks from unknown law firms start coming in as if out of nowhere.

And often, no one stops to remember James, the board member who got all of his friends and colleagues to include the organization in their wills. James has passed on and so have his friends. So, the bequest intentions he and his friends made, perhaps 10 or 20 years ago, are now resulting in an influx of funds.

The very real cause-and-effect of the former board member’s work is lost. And while the staff and board are delighted with the surprising large “windfall checks,” no one says, “Hey, James’s work fifteen years ago made this happen. Let’s start up a program to make this kind of fundraising a regular part of what we do.”

No. They just thank their lucky stars, deposit the money and keep right on investing their development dollars in their gala and direct response fundraising where the investments show up on the bottom line in short order. Until a capital campaign comes along!

Let’s first compare how capital campaigns and planned giving work:

Capital campaigns are big, outsized fundraising operations. Though the active phases of a campaign generally wrap up in three years, the pledge payments usually extend for some years after the conclusion of the campaign. These campaigns often raise 10 times the amount an organization raises from philanthropic sources in any given year. And, if the organization is wise, they include an increase in their endowment as part of their campaign objectives.

Though campaigns are often organized around specific capacity-building initiatives like new buildings, expanded programs, and investments in more efficient and effective systems, most campaigns also raise money for their endowment at the same time.

Because the stakes are high and the time frame is relatively long, staff and board members are willing to invest in fundraising in ways they aren’t during year-in, year-out fundraising. In fact, most campaigns have a budget of their own that will come out of the funds raised through the campaign.

Unlike other investments in fundraising, planned giving is best developed through regular communications that remind donors of their opportunities to make a planned gift. It is perhaps best thought of as marketing rather than fundraising.

People don’t usually make planned gifts on impulse. They make planned gifts when they redo their estate plans, which is most likely to happen in conjunction with a change in life stage or a specific event. Perhaps someone has inherited money from a parent. Perhaps their daughter or son gets married. Maybe they have a new grandchild. Perhaps they lose a life partner.

Events of that sort often trigger a visit to an estate planner or attorney. This is one of the most common situations when donors make the actual decision to set up a planned gift. If they are thinking about your organization when they sit down with their planner, they might well decide to include you in their will.

But that kind of awareness takes time. And on average, an investment in a planned giving program doesn’t yield results for the first five years. Now consider what could happen in a capital campaign if endowment giving is built into your plans from the start.

If your campaign roadmap includes an endowment component and you use its five-year timespan to build your planned giving communications, the results of your planned giving investment will start to pay off as the campaign draws to a close.

The idea is to seize the opportunity to devote attention and resources to planned giving amid the surge of energy and engagement that comes with a capital campaign.

During your campaign, you and your team will communicate in many ways with your lead and mid-level donors to build relationships. If one of the campaign objectives is to increase your endowment, you will be able to talk with your donors about making that portion of their campaign gift through a planned gift. The context of the campaign makes it easier to bring up these opportunities organically.

For some donors, the chance to make a gift that involves cash or stock with a planned gift is appealing. Their campaign gift can be higher than it would be without a planned giving component, and they can feel comfortable knowing that they are helping to ensure the long- term viability of the organization.

Many people who make planned gifts are mid-level donors who have given year after year for a very long time. They may not be able to make a large gift of cash or stock, and if they are in their retirement years, giving away resources they may need to live out their lives may make them anxious. But as long-time loyal donors, they want to make a generous campaign gift.

Making a planned gift to the campaign endowment might be an ideal option for these donors.

Keep in mind that the campaign goals that require short term funds won’t be supported through planned gifts (which may take years or even decades to realize). But as long as your campaign includes an endowment component, you can offer a new giving option and encourage people to make planned gifts.

If you are heading into a capital campaign, use that as an opportunity to invest in creating a planned giving program that will continue long after the campaign.

Consider allocating some funds from your campaign budget to invest in the help of a planned giving expert. A professional can help you create a sustainable plan and develop the planned giving structures and materials to use both during and long after your campaign.

You might even include an investment in creating a planned giving program as one of the campaign objectives. If you do, support it with the same strategic planning, gift range charts, and other documentation as you do the other aspects of the campaign.

The bottom-line: Don’t miss the opportunity to invest in your organization’s future through your capital campaign. It’s a natural opportunity to make structural updates and improvements that will keep your nonprofit thriving for decades to come.

Capital Campaign Readiness Assessment

Is your organization ready for a capital campaign? This simple assessment tool will help you find out. You’ll assess six key areas of your organization. Take this free assessment and find out if you’re truly ready for a campaign.

About the Author: Amy Eisenstein

Amy Eisenstein, ACFRE, is CEO & Co-Founder of the Capital Campaign Toolkit.  She is a veteran fundraising consultant. With over 20 years of experience in the nonprofit sector, she’s published a number of books, including Major Gift Fundraising for Small Shops. Amy is also an in-demand keynote speaker and an engaging board retreat trainer and facilitator.