Considering Contingent Gifts

Embracing Contingent Gifts and Meeting Donors Where They Are

Sometimes I miss the days when I spent much of my time as a planned and major gifts officer getting to know donors. I loved meeting them, learning their stories, and was always inspired by them.

Part of getting to know them was learning how their concerns, goals, and plans changed over time. Often, they would include a contingent gift in their will to my organization– one we wouldn’t realize unless their spouse, children, etc. did not survive them.

They were unsure what their family’s future needs would be and if something happened to them, they didn’t want to risk their loved ones’ well-being. Of course! Isn’t that obvious?

When I met with them later in life, their circumstances were different. They were not as worried about outliving their assets; their younger family members were self-sufficient; and they felt comfortable updating their plans to make that contingent gift non-contingent. (Of course, they could also take the organization out completely if their priorities had changed – or if they hadn’t been well-stewarded).

But over the past decade or two, I think contingent gifts have become less important to organizations. The gifts aren't often qualified for any of the legacy challenges that became common; fundraisers don’t get “credit” for these gifts (I could rant for YEARS about terrible crediting policies); many organizations and gift officers see these gifts as too tenuous to be “real”. And because these donors are not as actively stewarded (or even truly encouraged to share their intentions), fundraisers lose the opportunity to build long-term relationships with them – and the opportunity to ask/learn if a contingent gift could become non-contingent at the appropriate time.

But EVERY gift in a will is revocable. Every gift is contingent in some way until the supporter dies and the money is distributed. You can ask for all the details you want; you can ask donors to sign detailed gift notification forms; you can push for copies of their will….but none of that will do anything to ensure that gift actually arrives. And it’s really off-putting to donors.

Many fundraisers want to prioritize “younger” donors – those in the time of life when their first plan is hopefully made. Resources and tools are offered to help them plan and they are encouraged to add a gift to charity. We include language that says “family comes first! You can care for your loved ones and make a gift….”

But… what if we’re missing an important part of the message? What if that “family first!” language isn’t as clear as we think it is? What if we need to better acknowledge the challenges that people now face in thinking about the future? What if we need to show them how to put family first – not technical details, but by sharing more information about contingent gifts?

In recent focus groups we’ve done, in other research I’m seeing, in surveys, etc. something is becoming very clear to me: we’ve dropped the ball on this message. Particularly to our supporters who want to/feel obligated to/need to care for family or others close to them. And when we do share this message, it feels like window-dressing if the donors are not prioritized, thanked, or stewarded in the same way as donors with non-contingent gifts.

Of course, people without kids/grandkids are more likely to include charities in their plans. But most of your supporters HAVE children – or other family they want to care for. The definition of “family” is, happily, much more expansive than the traditional nuclear configuration.

People in their 60s, 70s, even 80s, are not always “looking back.” They aren’t always or often concerned with pondering “how they want to be remembered.” They aren’t necessarily interested in considering their “legacy.” They don’t want to “leave a legacy of whatever for future generations.”

They are looking ahead:

They want an active, urgent, meaningful legacy proposition that reflects reality: we aren’t going have a world free from poverty anytime soon. We (as is horribly clear right now) are not heading inevitably to a world where discrimination is only a memory, and everyone is accepted for who they are. The arc of justice is, perhaps, not as inevitable as we had hoped. What is true is that the battles we are fighting are won in increments. That for every two steps forward, we take one (or three back). That the future we want is something that we need always fight to achieve and to keep.

They want to know the role their future gift will play in these battles. They don’t want to passively “leave a legacy.”

And personally, they are looking ahead, for good and for bad:

How long will they need to work? Is retirement ever going to be an option? Or will it come involuntarily?

Will they outlive whatever they’ve managed to save?

·Will they face ever-increasing health care expenses?

Will their kids ever pay off their student loans (as someone who will be paying mine until I’m in my 60s and my own kid is hopefully well out of college, I relate too much to this one)?

Will they need to provide ongoing support to their kids and grandkids or other younger family members who seem likely to not do better or even as well as their parents did?

What about wars, economic inequality, racism, pandemics, the possible destruction of democracy…. Ugh.

On the positive side:

Do they want to consider an encore career (my grandfather-in-law, in his 90s and retired from two different careers, asked me if I had an opinion on what his third should be)? Start a business? Travel?

Can they anticipate another two decades of hopefully active and healthy life after they retire? How might they want to spend that time?

Skydiving sounds like a fun new hobby…

Legacy? Who has time for that?

For those who are focused on caring for loved ones but have fewer economic stresses, remind them – after sharing an urgent legacy proposition that makes them very motivated to act – that even a small % to their favorite causes can have a big impact while ensuring that most of their assets go to their kids.

But the supporters who care passionately about your mission but are trying to balance a lot of uncertainty – and this is likely most of them – need a different message.

1) We know that the future is uncertain.

2) We know that you may not update your plans anytime soon.

3) We know that even if you do put a gift in your will for us, there is absolutely no guarantee we’ll get anything – and there shouldn’t be. Revocable, remember?

4) So, we’re not going to harass you for details or even disclosure of a gift.

5) And if you do need to update your plans, and would consider a gift, we can show you how a contingent gift might be a great pledge for the future – but one that will never negatively impact your family.

6) If you aren’t updating your plans now, you could name us a contingent beneficiary of your retirement plan or other account, without needing to update your will.

7) Whether your gift is for now or later; contingent or not; it’s your passion for the cause that is the real gift!

8) When you’re able to consider your plans again, update your will, or feel more certainty about the future, you can always make your gift non-contingent. And we’d be happy to help.

Would love to hear your thoughts on this – drop me a note ([email protected]).