Transcript Slide 1

Discovering Estate Gift Donors:
Maximizing Estate and Planned Gift Prospecting
Susan Hommes
Senior Planned Giving Officer
University of Minnesota Foundation
Presentation Objectives
• Understanding why estate gift prospecting efforts
should be a strategic part of your daily work plan
• Understanding of engagement strategies for
productive donor conversations with most likely
estate gift prospects
• Understanding of the importance of a strategic
partnership between prospect development and
development staff leads to the best donor outcomes
Profiling the Estate Gift Donor
Common Characteristics of Estate Gift Donors
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Near or in retirement, typically over age 70
Cash “poor” but asset rich
Redeploying assets for retirement income
Own appreciated assets
Widow/widower
Never married
No heirs, or heirs are provided for
Philanthropically motivated
Profiling the Estate Gift Donor
While not absolute, one of the best indicators of
estate gift potential is:
A multi-year donor at any gift level
Profiling the Estate Gift Donor
Why is a loyal donor a solid prospect for
an estate gift?
• Demonstrated philanthropic intent
• Understands the mission and ties it to their
own personal well being and the well being of
others they care about
• Long-term connection
Donor story – CLA Economics Department
2012 Stelter Research
What Makes Them Give – Stelter’s 2012 Survey
• 21% of donors with estate gift in place had
never donated to the charity
• 20% had been giving for less than 5 years
Key Point: Long history of giving isn’t the only
characteristic to focus on – we can’t forget those
who aren’t loyal contributors (incorporated into
marketing strategy)
Donor Story – Self-identified alum
Profiling the Estate Gift Donor
Donors without heirs (children or
grandchildren) are the most likely to make
charitable bequests.
This factor is more important in predicting an
estate gift provision than education level, wealth,
substantial giving or volunteer engagement.
Source: University of Georgia,1995-2006 study of 20,000 Americans aged 50+
Profiling the Estate Gift Donor
Myth: Estate Gift Donors are 70+
According to the Center on Philanthropy at
Indiana University bequest study, the best
time to approach donors for a bequest
commitment is between ages 40-50 for less
affluent donors and 50-60 for more affluent
donors. (Affluent = $200,000+ income or $1 million assets)
Profiling the Estate Gift Donor
“The Secret Giver” – The Stelter Company
• US residents are making wills at a younger age
• Less than 10% report removing a nonprofit
from their estate plans
• 36% of bequest contributors have alerted
nonprofits of their gifts. Why so few?
Recent Stelter research confirms this data
Profiling the Estate Gift Donor
“Secret Giver” Lessons
• Invite younger donors to consider an estate gift
• Help donors to feel comfortable sharing their
plans with us
• Steward loyal annual donors well – even if
loyal giving has dropped off or stopped!
Profiling the Estate Gift Donor
Stewardship is vital!
Consistent engagement increases the likelihood
donors may share their gift decisions with us, or
simply not change their minds, and will
sometimes lead to more and larger outright gifts.
Donor stories: Importance of meaningful contact
and new and increased estate commitments
The UMF Estate Gift Donor
Realized UMF Estate Gift Donor Analysis
• 860 households in data set
• Average estate gift size: $226,459
The UMF Estate Gift Donor
Lifetime donor characteristics:
• 65% of estate gifts from lifetime donors
Age when first planned gift was made
• Youngest – 32
Average - 81
Average Age at time of death – 84
– National average - 83
• More often women (53%)
• Household alum – 68%
Non-alum – 32%
The UMF Estate Gift Donor
Non-lifetime donor characteristics:
• 35% of estate gifts were first time gifts
Age when first planned gift was made
• Youngest – 45
Average – 82
Average Age at time of death – 83
– National average - 83
• More often women (57%)
The UMF Estate Gift Donor
Key UMF Estate Gift Prospect Profile
characteristic:
There is a strong correlation between the number of
fiscal year commitments made during lifetime and a
corresponding estate gift
• 6 fiscal year commitments made over a 15 year
period
The UMF Estate Gift Donor
Prospect Management/Stewardship Impact is Significant!
After an estate gift commitment is made and contact
manager/stewardship engaged:
• Average of 5 additional commitments made during
lifetime
• Average commitment of $352,267 (Median $12,350)
• 159% increase in gift commitments
Real Life Example
Marguerite Louise Gilmore
• Long-time Duluth resident, retired teacher, consistent annual contributor of
$50 - $500 to the Tweed Museum of Art
• Gifts in DMS start in 1987 and end in 2003 (16 commitments)
• Member and frequent visitor to the Tweed Museum
• Single
• No children
• Inherited wealth from parents investments, didn’t
show up on wealth screening
Real Life Example
Marguerite Louise Gilmore’s Legacy
$3.2 million perpetual trust in support of the
acquisition of art of high quality, focusing on
three dimensional art to aid in and enrich the art
education of students at UMD and the
community in general.
• Gift represented 40% of her estate
• We did not know about her gift prior to her death, nor did we have any
wealth indicators information.
UMF Estate Gift Predictive Model
The UMF Estate Gift Predictive Model
Calculates a Person’s Likelihood to
Make an Estate Gift to the U
UMF Estate Gift Predictive Model
The model is based on the best set of
predictors for the likelihood to make an estate
Gift (9 predictors, listed in weighted order of
importance):
• Number of fiscal year commitments in the past 15
years
• Marital status
• Status regarding heirs (children, no children,
unknown)
UMF Estate Gift Predictive Model
Best Set of Estate Gift Predictors, cont.:
• Very strong booster (based on survey response)
• Award/Affiliation (Individual belongs to DMS Group
type Honors & Awards or Group type Affiliation
• Property owner (the individual has real estate
information in DMS or based on wealth screening
data)
• UMAA Membership
• Female
• Legacy Family
UMF Estate Gift Predictive Model
Selection Criteria
Individuals with estimated age >= 40
PG Predictive Model Scoring System
The predictive model gives a score from 0 – 1
The highest score of 1 implies that the
“individual has a 100% likelihood to make an
estate gift to the University.”
UMF Estate Gift Predictive Model
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A (90-100%) =
B (80-89%) =
C (70-79%) =
D (60-69%)=
E (50-59%) =
F (40-49%)
G (30-39%)
H (20-29%)
I (10-19%)
J (0-9%)
Most Likely to Make an Estate Gift
Very Likely to Make an Estate Gift
Likely to Make an Estate Gift
Less Likely to Make an Estate Gift
Least Likely to Make an Estate Gift
F-J Scores
Unlikely to Make an Estate Gift
Example – Predictive Model Score
Data Sample – “A” Score Donor – Most Likely to Make an
Estate Gift
• She has been giving yearly since 1982
• No children (verified via contact report)
• School of Nursing BS, Public Health MA
• Woman
• Very strong booster (survey response)
• UMAA life member
• Property owner/affiliated with the U
Estate gift predictive model score: 99%
Predictive Model Information Uses
• Prioritize prospects to potentially initiate estate
gift conversations as part of overall prospect
research segmentation – EGPM score is visible
in DMS and score is dynamic
• Utilize predictive model scores to identify
specific target markets (i.e. for mailing lists,
estate and gift planning strategies seminars,
newsletters, etc.)
• Estate gift survey strategy
Estate Gift Survey Strategy
Survey purpose: To identify new estate gifts or
update us on their plans, or to identify those with
an interest in making an estate gift. Also plants
the seed of the idea for considering an estate gift
with likely prospects.
Format: Personalized letter and survey to a
targeted group of estate gift prospects.
Estate Gift Survey Results
Results to date (thru April 2014):
• 31 surveys sent using predictive model since 2009
– 3 in process – Nursing, CLA, Extension Retirees
– Medicine and Health surveys in process (Children’s Health,
Neurosciences, Diabetes/Special Initiatives, 3 Minnesota
Lions Foundations supporting Hearing, Vision, Diabetes)
• New gifts: 100
• New production: over $7.85 million
• Confirmation of previous gifts: 108
• Number may consider a gift in the future: 103
• Response rate range – 1.08% - 12.9% (approx. 4% average)
Informing the U Development Community
• Educational Seminars
• Roll-out information via e-mail
(share e-mail content)
• Periodic Update Meetings in
partnership with UMF Prospect
Development
Estate Gift Prospecting Tools
Planned Giving Historical Data Report
Five year historical snapshot of estate gift
production by campus/unit/corridor
Opportunities:
• Review & understand future gift pipeline
• Potential areas for focused growth strategies
• .11 cent estate commitments
Estate Gift Prospecting Tools
Planned Giving Prospect Evaluation Grid (PEG)
Prospects placed on grid showing the intersection of
the prospect’s estate gift predictive model score and
financial capacity.
Opportunities: Engage with unit/campus/corridor
development staff in discussion and implementation
of one to one, or group strategies towards new gift
production.
Estate Gift Prospecting Tools
Outstanding Acheivement Award (OAA)
Winners
Identifies unmanaged OAA winners by
unit/regional affiliation, ensuring review as
prospective estate gift donors.
Prospect story: Retired Baylor professor
Estate Gift Prospecting Tools
Text Mining
• Through data analytics process of text mining,
references to estate or planned gift conversations
in contact reports are identified
• Prospect Development team conducts initial
review to validate text, and refers several per
month to Planned Giving team
• Planned Giving team reviews and determines
recommended strategy with units
Text Mining Keywords
Keywords used in text mining search process:
estate gift, bequest, annuity, annuities, planned
gift, beneficiary designation, estate plan, ira,
retirement plan, gift at death, in their will, in his
will, in her will, in our will, in my will, tb, crt,
crut, crat, clt, charitable remainder trust,
charitable remainder unitrust, charitable
remainder annuity trust, charitable lead trust
Text Mining Example
UMF Contact report:
Responded to January 2001 issue of Making A
Difference (UMF Planned Giving
newsletter). He requested that we send him
information about using retirement assets to
make a gift, and he also said that he would be
interested in attending a seminar on values-based
estate planning."
Estate Gift Conversations
Information elicited via prospecting efforts and
discovery conversation can easily segue into
problem solving conversations around specific
assets and specific circumstances.
Estate Gift Conversations
Signals to listen for include:
• No heirs, or heirs that are well provided for
• References to illiquid assets, like real estate or
other non-cash assets
• Ties to family business
• Assets producing no income
• Retirement planning
Estate Gift Conversations
Signals to listen for include, continued:
• Desire to make a major gift using assets other
than cash
• Alludes to highly appreciated assets or tax
deferred assets
• Concerns about time/energy devoted to
managing assets
Estate Gift Conversations
Questions to consider when discussing gift structure:
• Do you need an income or estate tax deduction?
• Do you need additional income – either now or
potentially in the future?
• Do you want to see your gift put to use during your
lifetime?
• Is there someone (yourself) you want to recognize or
honor by your gift?
Estate Gift Conversations
Questions to ask to clarify donor motivations:
• Who has made the greatest impact in your life? What
gives you the greatest satisfaction in life? (Panas)
• What would you like to accomplish with your money
that would be meaningful to you? (Advancement
Resources)
• Have you considered an estate gift commitment to
perpetuate your current giving (or in support of your
current scholarship)? Is there something holding you
back from taking this step that I can be helpful with?
Estate Gift Conversations
Questions to Ask Donors
• If there were no restrictions on you, what
would you like to do philanthropically?
Would you tell me more about this…?
• What have you told your loved ones about
your charitable goals?
Estate Gift Conversations
Questions to Ask Donors
• What worries would you need to address, if any, in
order to fulfill your charitable plans for the University
and others you’ve supported during your lifetime?
• What kind of lasting difference or legacy would you
like to leave your family (and/or this community),
and what are your ideas to accomplish or complete
this goal(s)?
Estate Gift Conversations
Local estate planning attorney, Karen Ciegler Hanson,
asks this central question of her clients:
• How much do I need to share to demonstrate
my love and care for people and organizations
that have played an important role in my life?
Estate Gift Conversations
Universal Question to Ask Donors
Have you considered naming the University of
Minnesota (or insert your collegiate unit or
program) as a beneficiary in your estate plan?
Stewardship Conversations
Fact: The most productive group of
prospects are our current estate and planned
gift donors (i.e. gift annuitants)
Reminder: On-going stewardship visits are
critical
Conclusions
• Keep estate and planned gift prospecting as an
integral part of the overall prospecting efforts
• Help development staff to be strategic about
stewarding loyal and known planned/estate gift
donors, and consider utilizing estate gift
predictive modeling (or other tools that your
shop can create) to identify your best estate
and planned gift prospects
Conclusions
• Once prospects are identified, look for ways to
help development staff to engage in
meaningful conversations. These will lead to
additional outright, estate and planned gift
opportunities.
• Stress the importance of listening carefully to
donor conversations and utilizing strategic
questions to address concerns that will help
donors fulfill their charitable dreams.
Contact Me
Susan Hommes
Senior Planned Giving Officer
University of Minnesota Foundation
200 Oak Street SE, Suite 500
Minneapolis, MN 55455
Phone: 612 624-8800
E-mail: [email protected]
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