Podcast: A Six-Step Plan to Start or Accelerate a Planned Giving Program

Season 2, Episode 34

In today’s podcast, special guest Joe Tumolo and host Andrea Kihlstedt talk about planned giving — why it matters and how to set up a planned giving program.

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This episode was recorded as part of a live webinar held Monday, April 11, 2022. To participate in future webinars, register at ToolkitTalks.com.

Andrea Kihlstedt:
Welcome to our podcast audience and everybody else. Our special guest today is Joe Tumolo. Joe has been in the planned giving business for about 18 years. That’s a good long time, Joe. 10 of those have been as a consultant and you both help people build planned giving programs, and you actually work for organizations to make sure those programs, some of those programs continue to be successful. You both teach them how to do it, and you actually do it. You’ve learned a bunch of stuff over the years, Joe, and I’m going to turn it over to you. I may heckle you or ask some questions as you go, but this is your show from here now.

Joe Tumolo:
Andrea, thank you very much. Thanks everybody for allowing me to hang out with you for a little bit today to talk about an area of fundraising that is so often overlooked, many times misunderstood, especially by some leadership and board members, but continues to grow in importance and value. And that is, as Andrea said, planned giving. And been doing this a long time for organizations of all shapes and sizes. One of the challenges as a speaker and fundraising is that everyone’s at a different level and what am I going to tell you that you don’t already know? So no matter where you are, whether you have a program, you don’t have a program, I’m going to give you some very, very specific tactical ideas to help you get to the next level. And think of this as a checklist.

Planned Giving in Six Key Steps

Planned giving can be very or seem to be very overwhelming for people, that’s the biggest challenge as planned giving consultants and some of my colleagues who, some of my friendly competitors we get together and we talk, and one of the common things is people say, “You know what? I’m just too busy. I have this going on. I’m down, especially nowadays I’m down two staff people, and I just can’t get to it.”

So what I’ve done, what we’ve done and tested it over the years is to lay it out into a simple seven steps. These are the seven steps, don’t feel overwhelmed and you can be at any level, but as long as you’re thinking about working on and incorporating these seven steps. Like any presentation, for all of us, any form of communication, we should always start with why, as thought leader, Simon Sinek teaches us. Why the wealth transfer? We’ve been talking about that for 20 years. Wealth transfer, it’s happening now. To the baby boomers where the bulk of our charitable dollars are coming from and so now is the time. I know it sounds like a cheerleader, but I am a cheerleader [inaudible 00:02:48]. But now is the time to be taking action because it’s the greatest wealth transfer.

The second reality is that the bulk of your donors, our donor’s wealth is not in their wallets or checkbooks, it’s in their assets, non-cash gifts. If you are not incorporating non-cash gifts in your daily conversations, then you are potentially missing out on 80 to 90% of your donors capacity to give.

I’m not really big on research or stats, not that that’s not important. I’m into tactical and practical. Rather than just look at a stat and say, “Oh, that’s interesting. Let me get back to my job here.” What stats are really going to motivate me to take action to pick up the phone, as Andrea said, and call people. Call people that are not expecting my call and have this planned giving conversation. A big, big one, and you probably have seen this wonderful, the wonderful Penelope Burk out of Canada and her great book, Donor Centric Fundraising, highly recommend that book. She’s a researcher, [inaudible 00:04:02] research. And one of the big, big stats that I took away from her years ago was that 34% of the donors they surveyed said they would indeed be open to a conversation with their favorite charities about planned giving.

So again, as someone that picks up the phone knowing that for every 10 loyal donors I call, three to four or maybe two to three would be open to a conversation, man, that gets me motivated. And I know initially it’s a numbers game. We talk about relationships, yes, but early on, it’s a numbers game until I can find those people that are open to maybe developing a deeper relationship. Now, the other part of that is sadly, only 17% of those surveys said that the organization even bothered to ask them. We’re not asking enough. And that’s one of my goals is in the work I do. Number one is to get you to think in different ways and to separate you from much of your competition. I assure you that most fundraisers out there are not bringing up these options for their donors and donors want options.

And if you are including them in your bag of tricks in your toolkit, so to speak, I promise you’re separating yourself from competing nonprofits that are competing for your donors attention and for their charitable dollars. If you did nothing else, and I’m not suggesting you do this, but so often I hear from people that tell me “We’re not ready for planned giving yet.” Well, I just told you now is the time. If you did nothing else, but with every donor you interacted and asked them, “Will you make us a beneficiary of your will or retirement plan? Here’s our legal name and our tax ID number.” At the very, very, very minimum, if you just did that, I promise you you’d be closing substantially more planned gifts. Now there’s more to it than that and I’m not suggesting that that’s all you need to do of course, because I’m going to go through the seven points right now.

I’m exaggerating this to make a point that if you did nothing else and if I had my 16 year old nephew pick up the phone and start calling loyal donors, good kid, nice kid, and he just said, “Thank you, Andrea. Thank you so much for being such a loyal donor. Why are you so loyal? Gee, have you ever thought about putting us in your will? Here’s our legal name and tax ID number.” I promise you Daniel could close plan gifts over the phone. Again, I’m exaggerating to make a point that it doesn’t have to always be this big complicated, “Oh my gosh, Joe, this is great. You don’t understand, it’s just me, I’m one person.” Yeah, but if you include this in part of your everyday habits and part of your everyday interaction with donors, it’s not extra work.

Number one, and I encourage you guys to take notes going through this quickly. And my guarantee with all my audiences, if I go over something too fast and you want to reconnect with me offline or through Andrea and the wonderful team there, we’ll make sure you get your questions answered. The first thing is the back office, what I call the boring but important stuff and that is infrastructure. Are we ready? Do we have everything in place to pursue and steward these donors in a fiscally responsible and donor friendly way? And so some of the things that you should be thinking about for infrastructure are, do we have goals? Do we have planned giving goals? There are behavior goals and result goals. A behavior goal could be, “My goal is talk to 10 donors this month about plan gift options.”

It might just be to say, “Hey, have you ever thought about, or have you included us in your will?” A result goal would be, we have a goal this year that we want to add, maybe we’re starting a legacy society, or we have one. We want to add 10 members this year. Like anything else, we need written goals just like in our capital campaign. The big difference is of course with the campaign is there’s a sense of urgency. And sometimes planned gifts don’t seem urgent, but certainly if we are, and we should be incorporating these into our campaign, then we should be having these very specific goals. And any frontline fundraiser that’s interacting with donors should have planned giving metrics. They can be different. It could be your annual fund person. Certainly those goals would be different than let’s say a director of major gifts or director of capital gifts.

Step 1: Gift Acceptance Policies

But everybody really should have some type of behavior or end or result goals. Gift acceptance policies. You can go online and just Google gift acceptance policies and you’ll come up with a ton of them. Most people I worked with initially tell me we’re all set. And I say, “Okay, send me your gift acceptance policies.” And they’re generally one page. It’s not enough. I’m not into making it 50 or a hundred pages, but there’s a lot involved. Are we going to take all types of life insurance gifts? Or are we going to take a property that somebody has in the middle of somewhere in the middle of rural Pennsylvania that maybe is near a coal mine? Do we want that? How do we accept it? Or how do we not accept it and not upset and alienate the donor? Those are the importance of gift acceptance policies. Gift counting.

How are we counting? Are we recognizing planned giving donors at the same level that we’re recognizing major gift donors? If a donor documents and quantifies their plan gift, I’m going to count them in the campaign, even though they may decide 30 years from now that their circumstances have changed and we’re not going to get the gift. That could be a whole nother conversation. A lot of these can. But do we have a gift counting policy that stewards and cultivates and makes their donor feel good about their giving, their planned giving, and also equally important is to make sure our fundraisers understand what we’re going to count and what we’re not going to count so that we don’t get a excited fundraiser come to us and say, “Guess what? I just got a $500,000 life insurance policy. Can I count that towards my goal this year?” Well, no, you can’t because it’s not paid up. As an example. Gift counting is important for the donor and to keep our major gift officers motivated or giving officers motivated.

The next category —

Andrea Kihlstedt:
Is this point two?

Joe Tumolo:
Yes. Point two. Thank you.

Andrea Kihlstedt:
I’m trying to take notes so you can tell me when you come in to number two.

Joe Tumolo:
Okay. Number two.

Andrea Kihlstedt:
Great.

Step 2: Board Strategy

Joe Tumolo:
Is the board, that’s B-O-A-R-D, not B-O-R-E-D, board strategy. Crucial. Very, very critical in all of this. Look, if the board’s not into it, I’m pursuing it anyway, but it would really help me if the board got behind this and helped me. And that’s my opinion. If I was with an organization, the board didn’t care about it, I’d be pursuing it anywhere, but it would be great to have them. So how do I get them to participate, to be involved actually hopefully make a plan gift? You need to have a one on one conversation with every board member. And one of the things you can do very simply is make up an Excel spreadsheet of all your board members and just have different columns and keep track of, “Okay, let’s say we have 14 board members, Mary Smith. Did I meet with Mary Smith to talk about planned giving?What’s the likelihood that she’s going to make a plan gift?”

And just keep track of that throughout the year. Have I met with every board member to have this conversation? That’s the big one. You can have someone do a board presentation, which is good. Nothing takes the place of one on one. But certainly having a board presentation does help. And so what do we want them to do? We want them to support this initiative. We want them to hopefully make a plan gift. And with the board, I find that it’s really important to stress to them this does not have to be a huge commitment. You could do something as little as make us a beneficiary, a 10% beneficiary of maybe one of your life insurance policies, paid up life insurance policy. Or you can make us a 5% beneficiary of your retirement plan.

It doesn’t have to be this huge commitment, because one of the biggest concerns that we hear from all donors is, “I want to provide for my kids and my grandkids in my retirement.” And yes you should. My first response is you should do that, but if you really, really want to have a bigger impact, if you really, really want to support the work we’re doing and the people we serve, chances are you can do all that, accomplish your personal goals and have a bigger impact. And it doesn’t always have to be coming out of your heirs pockets.

Step 3: Prospect Strategy

Number three, Andrea, is prospect strategy. Now I do believe, and I do preach that everyone is potentially a planned giving donor, every one of your donors. But some are more likely than others. We know that the long term donors, those donors that have been involved with us that are volunteering, that are giving at any level, those donors that don’t have children, research confirms, I can say anecdotally, but I can back it up with real research, current research, that your donors that were never married and or don’t have kids are our best prospects. We got a call, one of the organizations that I fundraised for, I got a call last week and they’re not even a donor. And she said, “I love what you guys are doing. You’re doing such important work. My husband and I don’t have kids. We want to leave your entire estate.” That doesn’t happen every day.

I’m not trying to over promise, but those are our ideal donors. Always be thinking about, always be qualifying our donors to see what category are they in. I know that everybody could be a planned giving donor, but maybe I don’t have the time and resource to call everyone. As I’m interacting, looking, identifying those loyal donors, those donors, ideally they don’t have children, they were never married, generally really good prospects.

And then I want to start as far as in my qualifying prospect and this, what I’m going to tell you now goes with any type of giving, annual giving, leadership giving, major giving, planned giving, capital giving, I use a simple system, the ABC system. And so I’m always thinking about what category is this donor in? And all I even ask them. I might say, if I’m really friendly with a donor, “Can I do a quick little survey to see if you’re an, A, B or C donor?” C donors kind of give when they want. We’re not really in their top five favorite charities, but they’ll throw us a check once in a while. B donors like us, maybe open to doing more, but just not the right time to do that.

And then A donors are like, “Yeah, bring it on. I love you guys. If I can afford it, if it works, I’ll do whatever. I’ll meet with you. I’ll talk about the campaign. I’ll sit on a committee. I’ll consider plan gift, a non-cash gift.” So always trying to figure out where are either asking directly or through the conversation. Is this an A, B or C donor? And where am I spending my time? Ideally, I should be spending most of my time with the A donors.

I see lots of things coming in here. Will look forward to answering all your questions. Here’s an action step. Go through your database. Start with 10, 25, 50, whatever number makes sense for you, donors, the kind of fit this profile. And first ask yourself and your colleagues, “Have we ever talked to these donors about non-cash gifts?” And then just start picking up the phone and calling these people. It’s not rocket surgery as I’d like to say. But it’s being acutely aware of “Have we had these conversations with these people?” And reviewing that list on a regular basis. And then like, I would, Andrea?

Andrea Kihlstedt:
Yes. I’m sure the people will appreciate it, Joe, if you just once or twice say when you pick up the phone to call one of these people who hasn’t been called, what would you say?

Joe Tumolo:
Sure. And I do it. I’ve been doing it today.

Andrea Kihlstedt:
You do it all the time. It’s easy for you and not easy for everyone else. So just —

Joe Tumolo:
Sure. Okay. Hi Andrea, This is Joe at ABC charity. First of all, I’ll say, “Am I catching you in the middle of something urgent?” That’s from Chris Voss, V-O-S-S, Google him sometime. Fascinating guy. And so most people say, “No.” I’ll say I am calling because you are a loyal donor. And I’m calling to say thank you. And maybe nobody’s picked up the phone to say thank you. Can I ask you why? Why do you care so much? So thank you. Why do you care? And then just let the conversation flow and try to keep them on the phone and keep asking the questions that we ask. And then for many donors, I have a particular client’s, Lesion Missions, been working with them for six years. We have probably a half a million active donors, so more than we can ever get to.

I’m making the ask. If we’re cooking on all, whatever the expression is, if we’re… On all cylinders and they’re loving it and they’re saying, “Oh my gosh, Lesion Missions, this is the history I have with them. I was a missionary or whatever. Love you guys, love the work you’re doing.” I will ask, “I know this is a question out of left field. I don’t suppose you ever considered including us in your estate plans, either your will or retirement plan.” Or “How you feel about a conversation around that?” Prepping it with, “I know this is a question out of left field.”

It’s like we’re the reality. It’s like the elephant in the room. I know this is a crazy question, but have you ever thought about it and especially older donors that love us and are loyal, again, back to Penelope’s research, two to three out of 10 will say either I thought about it or I’ve already done something, you guys never asked, which is common. So it’s that simple. It’s thank you, why, get them talking, if they’re really engaged, pop the question. Or is this too early, I know we just met over the phone. Would I be crazy to ask you if you’d be open to a conversation about other ways to support our work? Some of which costs us nothing now.

Andrea Kihlstedt:
Joe, we need to can that little speech so we can listen to it again and again, but that’s terrific. So, okay. Point number four.

Step 4: Donor Work

Joe Tumolo:
Number four, donor work. Uh-oh, you mean we actually have to work with donors? Yeah. A couple quick things around that. As I mentioned, really, I highly recommend everybody has planned giving metrics that’s interacting with donors. You don’t need to be an expert. I’m going to talk about that in a little bit. I’m not an expert. People call me an expert, I’m not. I’m not a tax guy, but despite not really being very, very fluent with the tax laws, I still somehow manage to do this work and close plan gifts. What a concept. But it’s really making it, plan gifts in your toolkit. I have it here. I’m not sabotage outright gifts, really important. There’s a wonderful researcher in our planned giving space, Russell James, and he talks about for major gift, capital gift donors, that clearly have the capacity to write us a check, a big check.

I don’t want to sabotage that by saying, “Oh, why don’t you just put us in your will instead?” No, we don’t want to do that. But it’s in my toolkit. And if I need to pull that out to help the donor accomplish their goals, I’m going to do that. But I may not. Well, I would never lead with a gift, which is another thing I see sometimes people get excited about this. It’s “Ooh, let’s go out and promote charitable gift annuities.” Okay, that’s fine. But let’s have it in our toolkit. And if it’s appropriate, then pull out that tool if and when the donor needs that. It’s really about offering, like I said before, offering donors options. You may be tired, Gary, you may be tired of us coming to you constantly and saying, “Gary, can you write us a check? Can you write us a check?”

Okay. It’s like, at some point, Gary’s going to say, “What else you got?” “Well, we have all these other options, non-cash options that maybe you never thought about and maybe we forget to mention to you. And so if you like, if it’s helpful, I can kind of walk you through these options, but I need to ask you some questions.” And so I like to think of myself sometimes I use metaphors all the time, sometimes I’m a Sherpa and I have all these tools on my back so to speak or in my toolkit and I am helping the donor, the donor that wants help, not every donor does, of course, but those that are open to it, say, “Let me be your guide. Help me understand what you’re trying to accomplish for yourself, for your retirement, for your family.”

I’m not an accountant. I’m not a lawyer. I’m not a tax person, not a finance person, but just high level questions. And it could be as simple as “Well, gee, Joe, I just retired. And for the first time ever, or first time in 40 years, I’m not going to get a paycheck and that’s really weird. And I’m not really feeling very rich right now, but I still want to support you guys.” Okay. I don’t need to be an estate planner or a financial planner or an accountant to know that they could put us in their will or beneficiary of their retirement plan and that’s not affecting their current cashflow.

So giving you simple, quick examples here. So suggestion, whatever the metaphor works for you. Sometimes I’ll think of myself as a contractor and I have my toolkit. And again, for those donors that are open to having deeper conversations, open to answering questions, being more thoughtful in the way they’re giving. And that’s one of the things I will use on a voicemail or email when I am calling donors is I worked with donors who want to be more thoughtful and strategic in the way they make their gifts.

Step 5: Messaging

And this is why I’m calling, to thank you and to see if you’d be open to exploring other ways. Number five, messaging. I used to call this marketing, but then people say, “Well, we have a marketing person. I’m not marketing.” Well, you know what? It’s messaging. We’re all messaging. How are we messaging these options to our donors? And so there’s a very common phrase, metaphor that we use here in our work and that’s above the line and below the line. And below the line is basically how to make a plan gift. It’s the planned giving options. It’s tax laws. It’s the stuff that freaks some people out and prevents them from ever even bringing it up. And then above the line is the more emotional, the aspirations of the donors, the donors need, the donors vision for the work we’re doing and the impact and the stories, the impact stories. That’s all above the line.

And I firmly believe that we should be spending as much time above the line as we can and as long as we can with a donor. So getting the donor, “Tell me more about that. Why do you care so much? What would be your vision?” All those great questions that you guys are asking. And then, at some point, like I do on my phone calls, how do you feel around the conversation about, whatever it is? And then we go below the line there. At that point, after we’ve established. And then in our messaging, in print and on our website, I believe that most of the, 80 to 90% of our message should be above the line. Here’s how you benefit from these non-cash gifts. Here’s the impact you’re having on the people we serve. And, oh, by the way, here’s a couple quick ways that you can do that.

So mostly above the line and then the below the line is almost an afterthought. I highly recommend that you have at least a one page planned giving marketing plan. You should be messaging planned giving in all your interactions. On your email signature, if you have content on your website, which you should have something, you can put that in your email signature with a hyperlink, make a gift, have a bigger impact, or make a gift that costs you nothing now, click here. Drive them to the website. But have a one page plan. It could be so, so simple. It could be why, why do we want to do this? Why would donors care about this? Who are our best planned giving prospects? What are we going to talk about throughout the year? And then when?

And let’s see, number six. All right. Making progress Andrea.

Andrea Kihlstedt:
Yes. I’m keeping up with you.

Step 6: Stewardship

Joe Tumolo:
Ooh. Yeah. Six is stewardship. And what does that mean? Stewardship is not just managing, like I just came up with this recently. We talk about donor relationship management, and maybe I’m nitpicking, but for me, it’s like, yeah, some donors I just want to manage. And I’ve alluded to this so far today is the reality is not every donor wants to have a relationship with us, even though we talk about that all the time, let’s build relationships with donors. Well, some don’t want. We all have those donors that might say, “Yeah, what do you got? Let’s go. Oh, you want me to write you a check?” So it’s hard to develop a relationship with those folks, but let’s meet them where they want to be met and treat them the way they want to be treated.

At the same time, I’m looking for the donors that say, “Yeah, let’s not just manage a relationship. What if we can grow it?” What if we can get them doing things they never thought possible and feeling really good about it. So stewardship is thanking, of course, in a personal prompt way. It’s recognizing them and it’s cultivating them. And if you have planned giving donors now, I hope you are personally reaching out to them at least twice a year. Number one is to thank them, make sure that they’re happy, feeling good about being a planned giving donor. Number two is if they have not documented their intention to see if they would feel good about doing that now, no pressure. You need to feel good about this Ms. donor. And if they have documented or not, would they consider increasing that intention? I did that with one of my alma maters.

I initially put them in a spare IRA that I have. I don’t really use it anymore. And then I had a life triggering event, a death of a family member who was also an alum of the college, my sister. And so we went from 10% beneficiary of that IRA and then five years later to giving them the whole thing and endowing a scholarship. The point around that is that first gift intention, plan gift intention, does not have to be the last.

Hopefully we wouldn’t go to an annual fund or major gift donor, ask for one gift and never talk to them again. So it is with planned giving. We need to think about, “Okay, which of these donors in our legacy society would be open at some point to doing more, to documenting, to increasing their intention.” And make sure, even if it’s a simple spreadsheet that you have a spreadsheet of all your current planned giving donors and you have columns for all these. Are they documented? Yes or no? Is it quantified? Yes or no? Do we think, or has the donor given us some indication that they might be open to increasing that intention over time?

And using that, checking that every twice a year or so, where are we? And if these are these donors that are assigned to other gift officers who are sitting down with those gift officers and going through the list on a regular basis.

Step 7: (Bonus Step) Training

And then finally number seven is I’d like to talk about training. A couple thoughts around training gift officers. And again, a lot of this stuff works for all fundraising, not just planned giving. But one of my favorite expressions, now we do, I make part of my living training gift officers and like every industry, nonprofit, every sector, most organizations don’t spend a lot of money and time training people. And so one of my favorite expressions is training, what if we spend money on training our gift officers and they leave? And the response is “What if we don’t and they stay?” So what if they stay and they’re not trained?

And we know that the average gift officer leaves 18 months after they start a nonprofit. That’s crazy. I’m not saying training is all the answers, but as part of your plan and your checklist, do we have ongoing, consistent training? Not just, “Hey, let’s send these people to a seminar once a year, AFP or wherever.” Of course, that’s great. That’s good. I think everybody, we all need more. We need ongoing training. We need frequency. Much of this is about building new habits and confidence, especially around planned giving. It’s repetition. Just like anything else. If you are learning… Pickle ball is all the rage right now, everybody’s picking up pickle ball or learning an instrument.

You practicing the same things over and over and over. Repetition until then I can wake you up from a sound sleep at three o’clock in the morning and say, “Andrea, why would somebody want to include you in their estate plans?” And you need to be able to answer that. That’s repetition of constantly practicing and practicing. Training is also testing. I learned something new, this guy, this Pizon on from Philadelphia that I saw on Andrea’s workshop today gave me some ideas. Let me go out and test it. And some of the specific examples I’m giving you are in my style and we all have different styles. You need to test it in your style and see if it works and see what to keep and see what to replace with something else. If you do any type of training and you’re responsible for it, I highly recommend that you survey the participants ahead of time, especially if you’re managing gift officers, a very simple, effective thing we do it with all our training clients is we send out a survey to the gift officers.

And one of the questions for planned giving is, “What would you need to do more with planned giving?” And some of the options are, “I need to feel more comfortable about the gift options.” It might be “Nothing, I’m doing all I can.” And another one is, “Well, I’m not incentivized to talk about plan gifts.” And so I always share that with the VP of development so they can see how their gift officers really feel about planned giving and their fundraising.