Ready to have your mind blown?<\/p>\n
There\u2019s a super simple thing you can do to\u00a0<\/b>dramatically<\/i><\/b>\u00a0increase your contributions.<\/b><\/p>\n
You can easily put this in place before the end of the calendar year \u2014 when most donors make their gifts.<\/p>\n
Trust me. You\u2019re going to want to read the rest of this article.<\/p>\n
Because you\u2019ll learn there\u2019s one thing growing organizations have in common.<\/p>\n
And it may surprise you.<\/p>\n
Ready?<\/p>\n
Let\u2019s assume here you want to keep growing.<\/p>\n
If not bigger, then deeper.<\/p>\n
You\u00a0either want to do\u00a0more<\/i>\u00a0of what you\u2019re doing, or do what you\u2019re doing\u00a0better<\/i>. Or both.<\/p>\n
Because if you stop growing, you wither and die.<\/p>\n
Guess what strategy you\u2019re likely not using enough that\u00a0really<\/i>\u00a0works to facilitate organizational growth?<\/p>\n
You\u2019re likely not actively promoting the fact you accept \u2013 and warmly welcome \u2013 gifts from a donor\u2019s assets.<\/b><\/p>\n
Dr. Russell James<\/span><\/a>\u00a0J.D., Ph.D., CFP\u00ae, professor in the Department of Personal Financial Planning at Texas Tech University, recently completed a landmark study reporting on data from 1 million NPO e-filed tax returns from more than 200,000 nonprofit organizations. What it revealed in terms of total\u00a0growth in fundraising contributions<\/b>\u00a0over a five-year period (2010-2015) from different types of charities was nothing short of amazing.<\/p>\n Organizations promoting and receiving stock gifts saw a positive 55% difference in growth from charities accepting just cash!<\/b><\/p>\n Your mind should be blown.<\/p>\n It\u2019s partly due to the way the human brain works. There\u2019s a psychological principal known as \u2018framing<\/a><\/span>.\u2019\u00a0Framing can establish a reference point.<\/b><\/p>\n In the context of considering a gift from income vs. a gift from assets<\/b>, often the suggested ask amount will be a significantly smaller percentage of a donor\u2019s\u00a0assets<\/i> (Big Bucket wallet) than a donor\u2019s disposable income<\/i> (Small Bucket wallet).<\/p>\n Researchers have found people don\u2019t treat all their money as if they have one big pool<\/b> of it.\u00a0Rather, they have separate mental accounts. When they spend resources they keep track of that expenditure based on the mental account it came from.<\/p>\n Do you think most donors would rather consider their gift disproportionately large (too much from that account) or readily doable (easy peasy from a different account)?<\/p>\n Do you think most donors would rather consider their gift big, or small?<\/p>\n Most donors would love to make an outsize impact if they could.<\/b>\u00a0And if they have appreciated assets, they\u00a0can<\/i>.<\/p>\n If you only ask for cash gifts, you\u2019re missing out on a whole lot of potential.<\/b><\/p>\n Wealth is not held in cash, but in non-cash assets (primarily stocks, bonds and real estate). Per the Russel James study referenced above, cash comprises less than 10% of the collective assets and wealth owned by Americans.<\/b><\/p>\n If you only ask for cash gifts, you\u2019re only dipping into the SMALL bucket.<\/p>\n You\u2019re missing out on 90% of the potential philanthropy out there!<\/b><\/p>\n Not only are\u00a0you<\/i>\u00a0missing out; your\u00a0donors<\/i>\u00a0are also missing out.<\/p>\n Because you\u2019re not helping them think broadly or see their own potential impact.<\/p>\n Your job, as a philanthropy facilitator<\/a>, is to help donors be the best they can be.\u00a0 hey want to love<\/i> themselves when they look in the mirror. They want to be heroes<\/i> who give your nonprofit\u2019s stories happy endings.They want to feel abundantly joyful<\/i> about moving the needle in a manner that makes a demonstrable impact.<\/p>\n Donors can\u2019t be their best<\/i> selves if you only let them give you cash.<\/b><\/p>\n You need to show them they can dip into their assets and make a more generous gift.<\/p>\n Let\u2019s look deeper into Dr. Russell James research. He conducted an experiment where shoppers entering Broadway Market in Cambridge, Massachusetts were asked one of two questions. The question had a significant impact on how much they ultimately spent inside the store.<\/p>\n Group 1: \u201cWhat\u2019s in your wallet\/purse? Cash? Credit cards?<\/i><\/p>\n Group 2: \u201cDo you own stocks? Bonds? Certificates of deposit?<\/i><\/p>\n The second group, having been reminded of their wealth, behaved differently. They spent 36% more!<\/p>\n Satisfaction\u00a0is often driven not by objective<\/i> amounts but relative<\/i> comparison<\/b>.<\/p>\n When you ask for gifts from assets, not cash, you remind donors of their wealth. Most donors like that. Because they realize by contributing appreciated stock they can:<\/p>\n Asking for the same gift from assets (where it may represent a very small percentage of the resources in that bucket) will more likely yield a \u201cYes.\u201d<\/p>\n Humans do a mental accounting. They attach labels to financial assets and then treat them differently.<\/p>\n Once you get a donor to make a\u00a0first<\/i>\u00a0gift from non-cash assets, they now consider these assets as a source for potential\u00a0future<\/i>\u00a0contributions. These\u00a0assets are now labelled as \u201cdonation appropriate.\u201d<\/b><\/p>\n Here\u2019s why, per the research:<\/p>\n BOTTOM LINE:<\/b> If you learn to encourage gifts from appreciated assets you\u2019ll get more generous gifts. Not just once, but repeatedly.<\/p>\n Sociological research suggests gifts of cash are seen as more anti-social and as placing emphasis on\u00a0money<\/i><\/b> (emphasizing market-based exchange norms) rather than inter-personal bonds\u00a0(<\/i>emphasizing communal norms).<\/p>\n Maybe it\u2019s because assets are seen as \u2018extra\u2019 and not essential in the way one\u2019s paycheck is. If a donor gives from assets, it\u2019s not going to change the way they live their lives. They\u2019ll still be able to pay for food, shelter, clothing, medicine and all their monthly bills.<\/p>\n Whatever the reason, we\u2019re somehow wired to think gifts of property are more acceptable.<\/b> For example, when you\u2019re invited to someone\u2019s home for dinner, you bring a gift of wine or candles (not $20).<\/p>\n So… you may as well tap into this psychology.<\/p>\n And… there\u2019s more!<\/p>\n A $10K gift from securities can be more valuable to the donor than the same gift from cash due to the tax benefits they\u2019ll receive.<\/b> Again, people spend unearned gains differently than hard-earned income. They can give more at the same net cost. This can drive long-term increases in giving.<\/p>\n In addition, with the new tax law<\/a> which went into effect in 2018, donors who previously\u00a0deducted<\/i> capital gains taxes on their state income tax returns (80% of states) will no longer be able to do so. So savings from not having to pay<\/i> these gains taxes have increased significantly.<\/p>\n It\u2019s up to you to guide a donor in this direction.\u00a0<\/b><\/p>\n And… there\u2019s more!<\/p>\n I love to share this strategy with donors who tell me they love all their stocks so much they can\u2019t think of any they\u2019re ready to give away.<\/p>\n Tell your donors they can give $10K in stock to your charity and use the $10K in cash (that they would otherwise have donated) to re-purchase the stock<\/b> \u2013 thereby wiping out all their appreciation\/capital gains liability and increasing their cost basis from this day moving forward.<\/p>\n So when they ultimately do sell the stock, they\u2019ll pay less taxes.<\/p>\n This is a way to be super helpful to your donor, while at the same time generating a significant gift.<\/b><\/p>\n And… there\u2019s more!<\/p>\n One great technique is simply to showcase\u00a0other<\/i>\u00a0donors making gifts of appreciated assets.<\/b> This triggers the psychological principle of\u00a0social proof<\/a>. People ask: \u201cDo people like me do things like this?\u201d<\/p>\n Well, in fact, they do!<\/p>\n Especially when they are following in the footsteps of others who appear to be receiving a benefit<\/p>\n Dr. Russell James conducted an experiment where donors were\u00a0presented with\u00a0two different scenarios:<\/p>\n Group 1: \u201cThis is how Sara benefited from establishing a Charitable Gift Annuity<\/i>\u201d<\/p>\n Group 2: \u201cThis is how you might benefit from a Charitable Gift Annuity<\/i>\u201d<\/p>\n The folks\u00a0in the first group made larger gifts. They were swayed by \u2018social proof\u2019 that this was a beneficial thing to do. In fact, if\u00a0you can age-match the example (Sara\u2019s age compared with donor\u2019s age) responses will increase.<\/p>\n The more you show folks people like them think this is an advantageous strategy, the more likely they are to follow suit.<\/b><\/p>\n Often you can find a broker willing to offer discounted fees for nonprofits. When donors let you know they\u2019re willing to make a stock gift, simply send them instructions that tell them precisely what to do:<\/b><\/p>\n Also let donors know if they prefer to use their own broker you are willing to set up an account with their preferred brokerage. Be sure to let them know, however, you use the broker you do because they give you a preferred rate.<\/p>\n When website visitors click on or hover over your \u201cdonate\u201d menu tab they should see \u201cappreciated securities\u201d as one of the \u201cways to give\u201d options.<\/b> Remember, you\u2019re the one that needs to plant this idea. If donors see this on other charity websites, and not on yours, they\u2019ll assume you don\u2019t accept stock gifts.<\/p>\n Here are some charities who rock this online:<\/p>\n This makes good economic sense.<\/b><\/p>\n According to\u00a0the\u00a0landmark\u00a0Russell James\u00a0study, organizations that received non-cash gifts\u00a0grew 50 \u2013 66% in the last 5 years;<\/b> nonprofits that accepted only cash grew only 11%. And this was true across the board, regardless of size.<\/p>\n Even small organizations experienced massive increases in contributions when they accepted non-cash gifts, especially securities. In fact, the smaller you are the more difference it makes!<\/p>\n So devoting some resources to promote bequests is likely to yield a high return on investment.<\/p>\n Donors may never have considered giving from wealth rather than from spare income. Knowing this is not only possible, but easy, gives them freedom to be generous.<\/p>\n If you\u2019ve been shying away from a \u2018planned giving program\u2019 because you don\u2019t have expertise on your staff, all you need to learn is how to promote and accept gifts of stock. And this isn\u2019t difficult at all.<\/p>\n Plus, if you don\u2019t even want to accept stock gifts directly, there are Donor Advised Fund programs at community foundations and financial institutions where you can send your donors. Your supporters make a tax-deductible gift there, reap all the benefits of making a gift of appreciated assets, and then\u00a0recommend a distribution<\/i>\u00a0to your charity.<\/p>\n So, no excuses.<\/p>\n You need to begin actively promoting acceptance of gifts of appreciated assets.<\/b><\/p>\n If you\u2019re set up to accept appreciated assets you\u2019re making giving more beneficial. It\u2019s a bit more hassle for your charity, but… if you want to walk the talk of donor centricity this is something you should seriously consider. If you<\/i>\u00a0don\u2019t do it, another nonprofit will.<\/p>\n Appreciated assets are a blessing many donors are willing to share.<\/b><\/p>\n","protected":false},"excerpt":{"rendered":" Ready to have your mind blown? There\u2019s a super simple thing you can do to\u00a0dramatically\u00a0increase your contributions. You can easily put this in place before the end of the calendar year \u2014 when most donors make their gifts. Trust me. You\u2019re going to want to read the rest of this article. Because you\u2019ll learn there\u2019s […]<\/p>\n","protected":false},"author":32,"featured_media":60914,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_relevanssi_hide_post":"","_relevanssi_hide_content":"","_relevanssi_pin_for_all":"","_relevanssi_pin_keywords":"","_relevanssi_unpin_keywords":"","_relevanssi_related_keywords":"","_relevanssi_related_include_ids":"","_relevanssi_related_exclude_ids":"","_relevanssi_related_no_append":"","_relevanssi_related_not_related":"","_relevanssi_related_posts":"","_relevanssi_noindex_reason":"","footnotes":""},"categories":[1],"tags":[],"cause":[],"article_author":[],"webinar_host":[],"topic":[344,350],"class_list":["post-43817","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-uncategorized","topic-fundraising-general","topic-leadership-culture"],"acf":[],"yoast_head":"\n\n
Why Asking for Stock Gifts Boosts Contributions<\/h2>\n
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Economics of Non-Cash Gifts<\/h2>\n
Psychology of Non-Cash Gifts<\/h2>\n
People Who Feel Wealthy Spend More.<\/h3>\n
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People Who Give Non-Cash Assets Act More Charitably Over Time<\/h3>\n
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Cash = Anti-Social; Gifts of Assets = Pro-Social<\/h3>\n
Appreciated Asset Gifts Cost\u00a0Donors Less<\/h3>\n
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Donors Who Love Their Stocks Need Not Change Their Portfolio<\/h3>\n
Use the Power of Social Norms<\/h3>\n
What Steps Should You Take to Secure Stock Gifts?<\/h2>\n
1. Set up a Brokerage Account<\/h3>\n
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2. Include a Sub-Menu on Your Home Page (under Donate)<\/h3>\n
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3. Give fundraisers extra tools and rewards to raise gifts of assets<\/h3>\n
Conclusion<\/h2>\n