ESTABLISHING A PLANNED GIVING/BLENDED GIVING PROGRAM STARTING WITH BEQUESTS OVERVIEW BY MIKE MCKELVEY

OVERVIEW 1)FOUR REASONS WHY NONPROFITS OF ALL SIZES SHOULD SEEK BEQUESTS 2)MYTHS ABOUT BEQUEST PROGRAMS: 3)10 COMMON QUESTIONS BY BOARDS/EXECUTIVE LEADERSHIP 4)PHILANTHROPIC PARTNER QUESTIONS 5)GENERAL RESEARCH FINDINGS 6)RECOMMENDED ACTION

FOUR REASONS WHY NONPROFITS OF ALL SIZES SHOULD SEEK BEQUESTS Nonprofits receive enormous sums of money from bequests. The opportunity to get bequests is nearly unlimited. Recessions can be a good time to seek bequests. Creating a bequest program is simple.

MYTHS ABOUT BEQUEST PROGRAMS: ONLY WEALTHY PEOPLE MAKE BEQUESTS. ONLY OLD PEOPLE MAKE BEQUESTS. ONLY WELL-EDUCATED PEOPLE MAKE BEQUESTS. PEOPLE GIVE PRIMARILY TO AVOID OR REDUCE TAXES. LEAVING MONEY TO A CHARITY IN AN ESTATE PLAN REQUIRES HIRING AN ATTORNEY. BEQUESTS AND OTHER ESTATE GIFTS TAKE TOO LONG TO “MATURE” A BEQUEST PROGRAM HAS NO PLACE IN CAPITAL CAMPAIGNS

10 COMMON QUESTIONS BY BOARDS/EXECUTIVE LEADERSHIP 1.WILL A FOCUS ON BEQUESTS/WILLS IMPACT OUTRIGHT GIFTS? 2.HOW MUCH WILL THIS CAMPAIGN COST OUR GROUP DIRECTLY OR INDIRECTLY AND HOW CAN WE DEMONSTRATE A ROI 3.WHAT WILL BE OUR REQUIRED DELIVERABLES FOR SUCH A CAMPAIGN? 4.HOW DO WE DOCUMENT/TRACK THESE TYPES OF COMMITMENTS? 5.HOW DO WE SET OUR FINANCIAL GOAL FOR THE CAMPAIGN?

10 COMMON QUESTIONS BY BOARDS/EXECUTIVE LEADERSHIP 6.HOW DO WE MEASURE THE LOYALTY OF OUR PHILANTHROPIC PARTNERS IN ORDER TO DEPLOY STAFF TIME EFFECTIVELY? 7.HOW DO WE ASSURE THAT THE EFFORT OF THIS CAMPAIGN WILL SINCERELY BE DRIVEN TOWARDS THE INTERESTS AND PRIORITIES OF OUR PHILANTHROPIC PARTNERS; HENCE MINIMIZING THE CONCERN OF A PHILANTHROPIC PARTNERS FEELING PULLED IN DIFFERENT DIRECTIONS? 8.HOW DO WE ASSURE THAT THIS CAMPAIGN WILL NOT DISTRACT FROM OUR CURRENT GIVING EFFORTS VIA ANNUAL GIVING AND SPECIAL EVENTS? 9.WHAT IS THE ADVANTAGE OF ENGAGING PROFESSIONAL ADVISORS? 10.ONCE A BEQUEST GIFT IS RECEIVED, HOW WILL THE PROCEEDS OF THE GIFT BE MANAGED?

PHILANTHROPIC PARTNER QUESTIONS: DOES MAKING A LEGACY COMMITMENT VIA A BEQUEST/WILL REQUIRE A LOT OF INTERACTION WITH AN ATTORNEY? HOW DO I/WE PARTICIPATE IS SUCH CAMPAIGN EFFORT WITHOUT CREATING DISINHERITANCE CONCERN BY OUR CHILDREN OR OTHER VALUED FAMILY MEMBERS? THIS CAMPAIGN SEEMS TO BE FOCUSING ON SPECIFIC FUNDS CAN I LEAVE MY GIFT FOR ANOTHER PURPOSE THAN AN ENDOWMENT? ARE LEGACY COMMITMENTS VIA A BEQUEST/WILL ONLY FOR THE WEALTHY? CAN I DESIGNATE A PART OF MY RETIREMENT PLAN OR LIFE INSURANCE POLICY? I AM NOT SURE HOW MUCH OF MY ESTATE; RETIREMENT PLAN OR LIFE INSURANCE POLICY VALUE TODAY WILL BE AVAILABLE AT MY PASSING. SHOULD I USE A PERCENTAGE OR DOLLAR FIGURE?

GENERAL RESEARCH FINDINGS How Bequest Giving Positively Impacts Current Giving Profile of a Philanthropic Partner Making a Bequest Commitment How long does it take for a bequest giving program to have an impact? Virtual Opportunity Fund Impact

KEY FINDINGS RESEARCH HAS SHOWN THAT INDIVIDUALS WHO NAMED CHARITIES IN THEIR WILLS GAVE MORE THAN TWICE AS MUCH ANNUALLY (MORE THAN $2,000 ON AVERAGE) THAN THOSE WHO DID NOT. INDIVIDUALS WHO SAID THEY WOULD CONSIDER NAMING A CHARITY IN THEIR WILLS ALSO GAVE ON AVERAGE ABOUT $500 MORE ANNUALLY THAN THOSE WHO WOULD NOT CONSIDER DOING SO. THE PEOPLE WHO ARE MOST LIKELY TO CONSIDER ADDING A CHARITY TO THEIR WILL ARE WELL EDUCATED (THEY HOLD AT LEAST A BACHELOR'S DEGREE); ARE MIDDLE-AGED (AGE 40-60); AND REPORT THAT THEY ARE MOTIVATED BY "DOING GOOD" AND "DOING WHAT IS EXPECTED." VERY FEW CURRENT DONORS HAVE ARRANGED TO LEAVE A GIFT TO A CHARITY IN THEIR WILL. ONE IN THREE OF THOSE WHO HAVE NOT ADDED A GIFT TO CHARITY IN THEIR WILL SAID THEY WOULD CONSIDER DOING SO. INCOME WAS FOUND TO NOT AFFECT THE LIKELIHOOD THAT A DONOR WOULD BEQUEST, OR CONSIDER BEQUEATHING.

KEY FINDINGS “PLANNED GIVING” IS NONPROFIT INDUSTRY JARGON THAT MEANS MAKING GIFTS TO CHARITY THAT REQUIRE PLANNING. THIS INCLUDES ESTATE GIFTS LIKE BEQUESTS AND BENEFICIARY DESIGNATIONS, AND ALSO INCLUDES CURRENT GIFTS THAT REQUIRE PLANNING, SUCH AS REAL ESTATE. 80% TO 90% OF PLANNED GIFTS ARE BEQUESTS AND BENEFICIARY DESIGNATIONS. FOR MOST NONPROFIT ORGANIZATIONS, THIS NUMBER IS 100%. 67% OF PLANNED GIFT DONORS ARE NOT TELLING NON PROFITS ABOUT THEIR BEQUEST INTENTIONS. ONE SURVEY PUTS THIS NUMBER AT 92%. $20+ BILLION IN CHARITABLE BEQUESTS ARE MADE IN THE US ANNUALLY. INTERGENERATIONAL WEALTH TRANSFER: STUDIES SUGGEST THAT WE’RE IN THE MIDST OF THE LARGEST INTERGENERATIONAL WEALTH TRANSFER IN THE HISTORY OF MANKIND. ESTIMATE: AT LEAST $41 TRILLION TO BE TRANSFERRED BETWEEN 1998 AND 2052, OF WHICH APPROXIMATELY $6 TRILLION COULD GO TO CHARITY. LONG-TERM LOYALTY TO THE CAUSE IS THE BEST PREDICTOR OF A PERSON’S WILLINGNESS TO MAKE A BEQUEST.

RECOMMENDED ACTION FOR MOVING FORWARD TIME MANAGEMENT OF REGIONAL DIRECTORS AND FUND RAISERS IDENTIFYING WHICH PHILANTHROPIC PARTNERS TO FOCUS ON ESTABLISHING A MARKETING COMMUNICATIONS PLAN BOARD ENGAGEMENT

CONSIDER THE WHY/WHAT QUESTION PHILANTHROPIC PARTNERS WHO HAVE GIVEN 5 YEARS OR MORE PHILANTHROPIC PARTNERS THAT ATTEND EVENTS – POST EVENT STRATEGY VOLUNTEERS BOARD ENGAGEMENT –NATURAL PARTNERS SALONS

KEY QUESTIONS BELOW ARE A SERIES OF QUESTIONS AND STEPS FOR BUILDING A RELATIONSHIP AND EVENTUALLY DETERMINING WHO/WHAT TEAM OF INDIVIDUALS WOULD BEST SERVE THE RELATIONSHIP WITH A PHILANTHROPIC PARTNER (ALUM/FRIEND/DONOR). ADDITIONALLY, THESE QUESTIONS AND STEPS WILL ASSIST IN MEASURING THE READINESS TO ASK FOR A CAMPAIGN GIFT. PLEASE NOTE THAT FAILING TO HAVING THIS INFORMATION DOES NOT PRECLUDE THE ANNUL FUND TEAM OR DEVELOPMENT OFFICER FROM ASKING FOR A CURRENT GIFT. THESE QUESTIONS ASSUME THAT THE PHILANTHROPIC PARTNER IS AN OSU ALUM OR DEMONSTRATES THE QUALITIES OF A FRIEND TO THE UNIVERSITY. SECURING THE ANSWERS OR COMPLETING THE STEPS COULD TAKE ANYWHERE FROM ONE-TO- FOUR PERSONAL MEETINGS. THE ACTUAL ORDER OF THESE QUESTIONS/STEPS IS NOT IMPORTANT, SECURING THE INFORMATION AND COMPLETING THE STEPS IS THE KEY.

KEY QUESTIONS WHAT WERE YOUR 1-TO- 3 MOST MEMORABLE EXPERIENCES AS A STUDENT AT OSU OR THIS CAN BE APPROACHED WITH THE FOLLOWING: IN TERMS OF THE PHILANTHROPIC PARTNER’S ASSOCIATION WITH THE UNIVERSITY, WHAT DO THEY CHERISH MOST ABOUT THEIR OSU EXPERIENCE AND TRY TO SECURE THE SAME FROM THE SPOUSE. ANY CURRENT CONTACT WITH A FORMER FACULTY MEMBER OR CLASSMATE? CURRENT FEELING ABOUT THE OSU? IF THE ALUM/FRIENDS ARE MARRIED, DOES THE DO/RELATIONSHIP TEAM KNOW THE SPOUSE AS WELL? MORE IMPORTANTLY, HAVE WE ACTUALLY SPENT QUALITY TIME WITH THE SPOUSE AND PHILANTHROPIC PARTNER TOGETHER? IF MARRIED, HOW DID THEY MEET THEIR SPOUSE? CHILDREN OR GRAND CHILDREN? WHAT ARE THEIR NAMES AND AGES? IF NOT OSU, WHAT INSTITUTION DID THE SPOUSE ATTEND? DO WE KNOW THE CAREER PATH OF THE PRIMARY PARTNER (THE HOW, WHAT AND WHY BEHIND THEIR CAREER JOURNEY) AND IF PRIMARY PARTNER IS MARRIED DOES THE SPOUSE HAVE A CAREER PATH? DOES THE HOME OR CAR MATCH THEIR SUCCESS OR ARE THEY DOWN PLAYING THEIR SUCCESS? OUTSIDE INTERESTS, SECURE INFORMATION ABOUT THEIR OUTSIDE INTERESTS (HOBBIES, BOOKS, ACTIVITIES, VACATIONS) DO WE KNOW THE NATURAL PARTNERS (OTHER ALUMNI OR FRIENDS ALREADY ENGAGED WITH UNIVERSITY) OF THE PHILANTHROPIC PARTNER OR SPOUSE? WHAT ARE THE TOP THREE CHARITABLE INTERESTS OF THE PRIMARY PARTNER? IF THE PHILANTHROPIC PARTNER IS MARRIED WHAT ARE THE TOP THREE CHARITABLE INTERESTS OF THE SPOUSE? DOES THE PHILANTHROPIC PARTNER OR SPOUSE CURRENTLY SERVE ON ANY PHILANTHROPIC, COMMUNITY OR CORPORATE BOARDS? HOW DOES OSU/HIGHER EDUCATION FIT INTO THEIR PHILANTHROPIC PRIORITIES? WHAT HAS BEEN THE PHILANTHROPIC PARTNER’S LARGEST GIFT TO DATE, IN TERMS OF THEIR TOP THREE CHARITIES? ARE YOU DEALING WITH A LEGACY CONNECTION TO THE UNIVERSITY? HAVE YOU IDENTIFIED THE BEST WAY FOR COMMUNICATING WITH THE PHILANTHROPIC PARTNER AND POTENTIALLY THE SPOUSE?

INITIAL RECOMMENDATIONS: FUNDRAISERS SHOULD FOCUS ON YOUNGER INDIVIDUALS FOR CHARITABLE BEQUESTS. INDIVIDUALS BETWEEN 40 AND 60. THE BOOMER GENERATION, WERE FOUND TO BE A SIGNIFICANT SHARE OF THOSE WHO HAVE ALREADY NAMED A CHARITY IN THEIR WILL AND ALSO THOSE WHO ARE WILLING TO CONSIDER MAKING A BEQUEST. BUT DO NOT IGNORE THE 60+ SEGMENT. JUST ASK. ONLY NINE PERCENT OF PEOPLE WITH A BACHELOR’S DEGREE INDICATED THAT THEY CURRENTLY HAVE A CHARITY IN THEIR WILLS WHILE THIRTY-NINE PERCENT INDICATED THEY WOULD CONSIDER NAMING A CHARITY IN THEIR WILLS. THINK ABOUT A GIVER'S MOTIVATION. A UNIQUE COMBINATION OF “DOING GOOD” AND “DOING WHAT IS EXPECTED” SEEMS TO MOTIVATE LIKELY BEQUEST DONORS. FUNDRAISERS SHOULD NOT FOCUS ONLY ON THOSE WITH HIGH INCOMES. REGARDLESS OF INCOME, FUNDRAISERS HAVE BETWEEN A ONE-IN-THREE AND ONE-IN-FOUR CHANCE OF SPEAKING WITH AN INDIVIDUAL WHO WOULD CONSIDER GIVING TO A CHARITY IN A WILL. TO CREATE ENERGY BEHIND THIS EFFORT IT IS IMPORTANT FOR THE BOARD TO PARTICIPATE EARLY QUARTERLY DIRECT MAIL SERIES, WEBSITE BANNER, INTERACTIVE PHILANTHROPIC PLANNING PAGE, NETWORKING WITH PROFESSIONAL ADVISORS AND EDUCATIONAL SEMINARS

THANK YOU QUESTIONS RECOMMENDATIONS CONCERNS