Bedeviled By Bequests? How to Integrate the Bequest Conversation and Be Successful

1. Bedeviled By Bequests? How to Integrate the Bequest Conversation and Be Successful FLF Training – Tuesday, January 29, 2013

2. Why do we care about estate gifts? • Stewardship • $17,500,000 every year for schools/colleges/programs • A Campaign is on the horizon.

3. Some estate gifts we receive when a donor passes away. • $247,100,000 in the last 20 years • Only knew about 1 in 4 gifts before UW received them • Average size = $150,000

4. Some we learn about while the donor is alive. • “Bequest commitments” • Can be changed.

5. Why are bequest commitments important? • Stewardship • Someday the gift will come • Realization of campaign goals

6. Creating Futures – Our last campaign • Planned Gifts = $314,330,000 • 12% of all dollars raised • 85% of planned gifts were realized bequests or bequest commitments • Median size of a bequest commitment = $300,000 • Laureate Status: - Campaign’s final year – 33 Laureates added to donor wall - 16 of those achieved Laureate status based almost entirely (96%) on their bequests

7. Our Next Campaign • Will success be more dependent upon bequests? • Especially for larger Campaign gifts?

8. Estate Gift Vocabulary • Bequests: “A gift of money, property, real estate or assets to be made (distributed) at a person’s death.” - Donor creates the gift through a document called a Will or Living Trust. - Donor can revoke (change) the gift during their lifetime.

9. Beneficiary Designation: “ Any asset (insurance/retirement plan) where a UW program is named beneficiary.” • Donor names UW as the entity to receive remaining assets (typically cash from sold investments) from a retirement account (IRA, 401K, TIAA/CREF), life insurance policy, or other retirement account.

10. Statement of Educational Purpose: An internal document used to specifically describe the donor’s intended benefit at UW. - Bequest language or beneficiary designation is very general – “I give to UW”. - Contract between UW and Donor. Gives directions to UW. - Expresses endowment language & preferences. - Can establish an “order” of gift priorities if Donor is uncertain of the amount UW will receive. - Can be changed by contacting Office for Planned Giving without the expense of an attorney. - Requires the Donor have a conversation with YOU.

11. Who Makes an Estate Gift? • Anyone! • Shows an affinity to UW. Giving history of 5 or more gifts to UW in any amount, including seat purchases and memberships. Giving does not necessarily need to be in consecutive years. • Lack of Natural Heirs. Single, widowed, no children. But not always . . . . . • Age. Retirement age or older – or maybe slightly younger. But not always . . . .

12. PG Model: UW Bequest Donor Characteristics • Engage in UW Activities (UW Association organized) • More are non alumni • UW donors • Female • Donor gives consistently (over 15 years) • Major gift prospects/donors (very high correlation) • High last gift amount (non-planned) – over $25K • Largest gift amount – over $25K

13. How We Learn about Estate Gift Donors & Prospects? • Donor self identifies. • Surveys: 2012 Surveys- 559 added to HSS and 700 received more information. • Direct Marketing Efforts: letters, postcards, Column’s ads, ads in school/college/program publications. • Planned Giving Model – AARM. • Frontline Fundraiser conversations with Donors.

14. Estate Gift Conversations are Important • Gives Donor all gift options in philanthropy. • Surveys indicate that many donors never thought about a bequest gift until they were asked. • Opportunity to Prevent Problems: • Name the charitable organization incorrectly • Gift supports outdated or impractical purpose • Gift is an asset that UW cannot use or accept • Donor’s attorney or other advisor may not have relevant expertise

15. FLF Bequest Conversation Comfort Zone

16. We are having conversations: • “Every Time. It is important for us to bring forth the 3 legged stool of giving in every conversation regardless of age.” • Brings up bequest topic in 50% of conversations. “It makes sense to help plan out a donor’s overall philanthropic plan. Even if the primary gift conversation is for current use (which it should be usually), it’s always good to start the long-term legacy conversation.” • “I do not bring up the topic often. I incorporate the strategy rarely unless the donor has brought it up.” • “Only if the donor is above a certain age, say 70+. I am hoping for cash first.”

17. “Yes. For many, a bequest is the only way a person will be able to give an “ultimate” gift. I want to ensure every donor I work with has every tool at their disposal to give as generously as they can. With younger donors, I bring it up right away as part of a comprehensive overview of their giving options. For more established donors, I take a look at their giving history and involvement before I bring up a PG Conversation. With older alums with little or no giving history, planned giving is often a vehicle I’ll mention off the bat, because it may be the only way they will feel comfortable parting with their assets.”

18. We do have challenges/obstacles: • Knowledge – afraid will use wrong terms, can’t explain options, will get in too deep. • How do I bring up the topic? • Don’t know if the donor is “ready” to talk about it. How do I know when it is appropriate to talk about a bequest? • If the donor is elderly, I don’t want to be seen as taking advantage of them – or having them feel like I am pushing them off the cliff. • If the donor is younger, I don’t want them to feel like I think they are old or that they ought to retire – I don’t want to offend them.

19. Estate Gift Conversation #1: • Retired Professor: “I have included UW in my Will” • CAO says: “Thank you!” • CAO thinks: Now what?

20. Survey Says: • “Still working on my response, however it would include something like, ‘That is wonderful news, thank you so much for including the University in your will. Your loyal support of the UW is making an important difference in the lives of students/program/faculty/etc. I would love to hear more about the areas you have chosen to support at the UW’” • “That’s fantastic!!! In our experience with estate gifts, it is always a good idea to clarify the expectations of our gift so we can know exactly what you want to invest in and be sure that your gift will be able to fund that expectation.” • “I thank them and ask if they have shared that information formally (in writing) with the University. A surprising number aren’t sure.” • “May I have someone from our gift planning office contact you?”

21. Estate Gift Conversation #2: • UW Graduates Say: “I would like information about including UW in my will.? • CAO says: “Wonderful, UW can send you that information.” • CAO thinks: How do I continue this conversation?

22. Survey Says: • “Wonderful, I can help you with that. I would like to include my colleague in our Office for Planned Giving because she specializes in just this.” • “Thank you, I would be more than happy to help you do that. Have you thought about what it is you would like to accomplish with a legacy gift?” • “That is wonderful, thank you. May I provide you with sample language to share with your lawyers about how to include UW in your will?” • “That’s wonderful news. Thank you. Did you know that UW has an office designated to gifts of that kind? They can actually be a great free resource for you. Would you mind if I introduced you to one of my colleagues from that office? They will be able to be the most helpful since they’re the experts on this topic.”

23. Estate Gift Conversation #3: • Prospect/donor is in the CAO’s portfolio. • CAO anticipates a bequest conversation with the prospect/donor. • Now what? Strategies anyone?

24. Tips for Success • Gather your courage – plan to have a bequest conversation. You may be the only catalyst to get your donor considering a bequest gift. • Partner with the Office for Planned Giving – Let’s plan together. • Strategize for each of your donors. When during your relationship does it make sense to have this conversation? • Craft your response when a donor volunteers that UW is in their will OR they want to include UW in their will. • Pick a story of a donor who achieved philanthropic success with a combination of types of gifts. Be able to share the story with your prospects. • Visit your donor with a Planned Giving Officer

25. THANK YOU • Want more information: • Corner a member of the Planned Giving Office • Handouts • Visit our website www.washington.edu/giving/planned-giving • Consult the Planned Giving Tool Kit www.depts.washington.edu/uwadv/major-gifts-grants/planned-giving