The Seven Deadly Sins of Planned Giving - By Richard Perry and Jeff Schreifels with Robert Shafis - Major Gift Academy

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The Seven Deadly Sins of Planned Giving - By Richard Perry and Jeff Schreifels with Robert Shafis - Major Gift Academy

The Seven Deadly Sins
of Planned Giving
By Richard Perry and Jeff Schreifels
with Robert Shafis

Find more White Papers like this at www.VeritusGroup.com

V
               eritus Group has always
               stressed the importance
               of building a strong major
               gift program because we
   believe it will be THE way to grow your
   revenue over the next several decades.

   Planned Giving is no exception.

   In fact, when you track the revenue
   of organizations who put in place a
   planned giving program 15-20 years
   ago, and really kept it going – today
   they’re on solid financial ground…
   even in a pandemic.

   Our Director of Planned Giving,
   Robert Shafis, knows all about solid
   planned giving programs – and what
   gets in the way. Together, we’ve come
   up with what we’re calling the “Seven
   Deadly Sins of Planned Giving.” These
   are the mistakes that will absolutely
   kill the effectiveness of your planned
   giving program.

   So if you’re thinking about starting or revamping your planned giving
   program, don’t commit any of these Seven Sins, and you too will be on
   solid ground well into the future.

   What you’ll learn
         Seven common mistakes that non-profits often make

         How to avoid these mistakes

         Ways you can do better in each area

The Seven Deadly Sins of Planned Giving                        Copyright © Veritus Group LLC 2021   02

S IN # 1

   The PGO is NOT Focused
   on Developing Meaningful
   Connections
   Just like we see with major gift officers, planned giving officers are all too
   often obsessed with meeting metrics. We don’t blame you. Your manager is
   even more obsessed with these metrics, because this is what our industry
   expects.

   This is where it goes wrong. You get focused on meeting a metric and you
   take your eye off the true goal: creating a solid, trustworthy relationship with
   the donor. We see this all the time… “hey, I met with 25 donors this month” –
   then we find out that many of those “meetings” were really quick, superficial,
   “drive-by’s” that didn’t do anything but allow you to check off a metric in your
   monthly report.

   Instead, the PGO should be focused on making “meaningful connections” –
   connections with donors that either deepen the relationships or move them
   toward a closed gift.

The Seven Deadly Sins of Planned Giving                              Copyright © Veritus Group LLC 2021   03

As Robert Shafis says:

“It means a lot of work to get in touch with the donor and provide them
what they want and need to learn about the charity they love, and the
many ways philanthropy can occur. You see, making one connection
or getting one visit, in the context of Planned Giving, is usually only the
beginning. Not only does the PGO need to tell the donor about the charity
and all of its work, they also need to engage in a discussion about the
donor, their family, their business interests and financial needs. Only when
the PGO has engaged on these matters can they do their best in crafting
a Planned Giving proposal which really meets the needs of the donor.”

The problem, however, is that many non-profit
organizations often have their PGOs involved in
more than planned giving. Leaders treat it as a
kind of “side hustle” or something. We see PGOs
getting pulled into major gifts, events and other
activities unrelated to planned giving.

Another problem that occurs is when we give
the PGO the responsibility to manage all the
less direct aspects of planned giving like gift
administration, stewardship, qualifying leads, etc.
This is all a diversion from actually creating those
meaningful connections. We want PGOs to be
out making those connections with donors.

To get PGOs out there, there are three
functions that need to be properly staffed and
operational for maximum success. You’ll notice
that the PGO is only in one of these three:

Securing new qualified donors for planned giving — A Planned Giving
01
Associate (PGA), not the Planned Giving Officer (PGO), works on all
the marketing that will cause leads to come into the organization.
Then the PGA qualifies those leads for the PGO.

The management of key relationships — A Planned Giving Officer
02
(PGO) deals exclusively with qualified donors who are best
positioned for a planned giving solicitation for new planned gifts.
This is an important point, because in the old system of planned
giving, the PGO did everything from lead generation to qualification
to solicitation, etc. This approach is a major strategic change.

03
Stewarding the donors who have said “yes” — A Planned Giving
Associate is given responsibility for stewardship of donors with
known, existing planned gifts – to maximize their connection to the
mission of the charity, and to minimize attrition of planned gifts as
the donor ages and ultimately passes away. This function is rarely
staffed and functional in a non-profit. Why? Because, in the minds
of the insiders, a living planned gift donor isn’t generating current
revenue. Therefore, the expense of stewarding them cannot be
justified. This is short-sighted, since 50% of the donors who make a
planned gift commitment change their minds before they pass away.
If they had been stewarded, this wouldn’t happen. So, the decision
makers in the organization are deciding to save a current expense by
losing future revenue. Not wise.”

When you build up your program with the proper staffing you see above,
you’ll help your PGO to focus on making meaningful connections with
their donors and avoid unnecessary distractions. You’ll see more gifts
closed, more joyful donors, and happy and fulfilled planned giving officers.

S IN #2

   Ineffective Lead Generation
   Bob really gets worked up when we ask him about how effective non-
   profits are in generating – and then actually following up on – planned
   giving leads.

   You see, Bob has been at this a long time, and he knows what works
   and what doesn’t. Unfortunately, he’s witnessed too many non-profits
   mishandling leads for planned giving and wasting away a great
   opportunity for the non-profit. He feels awful for the donor who wants
   to leave a legacy to something they feel passionate about, but it never
   happens.

   He pointed out that there are two big issues regarding
   lead generation.
                                                               The tired old
           Lead generation strategies have been ineffective    newsletters and
     01
           in identifying donors who are actually ready        direct mail are
           to make a gift. Years ago, the planned giving       becoming less
           program got leads from many sources: great          and less effective
           donors, allied professionals, newsletters, direct   every year
           mail and even from seminars.

The Seven Deadly Sins of Planned Giving                           Copyright © Veritus Group LLC 2021   06

But things have changed.

The tired old newsletters and direct mail are becoming less and less
effective every year, especially those seminars! They’re no longer
producing the quality leads that are needed. New planned giving
programs are using email, surveys, social media, donor-behavior
tracking and e-newsletters to create leads – but like any lead
generation program, it only works when you have a strategy behind
it and you’re constantly evaluating results and following up properly.
The problem is that too often, there’s no strategy.

02
No effective way to follow up. We’ve evaluated many planned
giving programs, and some lead generation strategies are bringing
in hundreds of leads at a time. This gives the PGO hundreds of “hot
leads” to follow up on all at once. This almost guarantees failure,
because it’s impossible to follow up those leads in a timely manner.
The lead generation function should be paced to properly “feed”
follow up. A related area is that there is no clear plan to follow
up with whatever leads are
generated. You’ve got to have a
plan for how to sift through and
qualify your planned giving leads.
Most PGOs who now have dozens
or hundreds of leads in their
inbox are overwhelmed and not
equipped to handle them.

Most PGOs should be well-versed
in the different planned giving
instruments and how to cultivate,
steward and lead a donor to close
a gift. That takes a lot of technical
expertise, which is why you pay
a good PGO a higher salary. Why
have that person also trying to
qualify leads?

We recommend hiring a Planned Giving Associate that can take
           those leads, qualify them and hand them over to your PGO, who is the
           technical expert and adept at closing gifts. This is a much more efficient
           and cost-effective way to turn a potential gift into a closed gift.

   If you’re leading a planned giving team, do you know how effective your
   planned giving lead generation is? How many leads are coming in each
   year, what is the cost of acquiring those leads, what is your plan for follow
   up, and what is the ratio of leads to closed gifts?

   If you don’t have that information, avoid Sin #2 of planned giving by
   stepping back to review your program, and work to really understand how
   effective you are in lead generation and follow up.

The Seven Deadly Sins of Planned Giving                               Copyright © Veritus Group LLC 2021   08

S IN #3

   Overloading Caseloads
   If there’s one thing we see in common in Planned Giving and Major Gift
   portfolios across a wide swath of non-profit organizations, it’s that PGOs and
   MGOs have way too many donors in them.

   For major gifts, we’ve often come across portfolios with three to four hundred
   donors in them; one portfolio even had 1,200 donors! That’s impossible to
   cultivate. But Bob tells us that it’s common to see upwards of 750 donors or
   more in a PGO’s portfolio.

   This renders the PGO totally ineffective. Quite honestly, it’s a disservice to
   donors who would like to have a meaningful relationship with you.

   A planned giving portfolio should only be between 125-150 qualified donors.
   No more. And what we mean by qualified is that the donor has been vetted
   and is proactively interested in talking to a PGO about writing up a planned
   giving instrument.

   This portfolio size is the only way a PGO can really be effective in their work.

   The reason we see so many donors in planned giving portfolios is that PGOs
   are keeping donors who really should be in ongoing stewardship, rather than
   being in an active portfolio. Many times, a PGO will tell us they have such a

The Seven Deadly Sins of Planned Giving                                Copyright © Veritus Group LLC 2021   09

great relationship with a donor and even though
Your work as a
they have already committed and made a gift, they
just don’t want to “give them up.”
PGO is to build
relationships with
We get that. But if the organization actually had donors through
a plan for those types of donors who could be
meaningful
stewarded by a planned giving associate (PGA), that
connections.
would really help the PGO focus on active donors in
their portfolio. (We’ll talk more about this in Sin #6).

Remember, your work as a PGO is to build relationships with donors through
meaningful connections. You can’t do that with a portfolio full of donors who
really just need thoughtful stewardship. Really, if you have donors in your
portfolio who have already committed to a gift, unless there is a real chance
of closing another gift, they should be taken out of your portfolio and put into
stewardship.

We recommend that, quarterly, you review your caseload and make decisions
as you close gifts with your donors and get either a “yes” or “no” from a donor.
Along with your manager, make a decision whether to keep them in your
portfolio or not. This will prevent you from overloading your caseload, and you
can focus on donors that you can cultivate for a gift.

We have seen too many overwhelmed PGOs trying to handle too many donors
at once. It’s not good for the PGO, and it’s certainly not good for donors who
want to make a difference and leave a legacy to help change the world.

S IN #4

   No Plan for Every Donor
   “Why do you support us?” “What is it about our organization that you love
   so much?” “What are the programs and projects that you get most excited
   about, and why?”

   Do you know the answers to these questions someone might pose to your
   planned giving donors? If not, it may be because you don’t have a strategic
   plan for every one of them in your portfolio.

   This is the fourth deadly sin of planned giving… NOT having a plan for
   every donor.

   You see, having a plan for every donor will ensure that you know exactly why
   your donor supports your organization and why it brings them so much joy.

   As you know, we’ve said many times how important it is to have a plan for
   every donor in a major gift portfolio. It’s part of the structure you need to do
   major gifts well. It’s equally important for a planned giving program.

   As Robert Shafis told us right before he became part of our team, “What I
   love about Veritus is your emphasis on planning. What we lack in the planned
   giving world is structure, and you all have been preaching this for decades.”

The Seven Deadly Sins of Planned Giving                               Copyright © Veritus Group LLC 2021   11

Bob is right. We’ve stressed having a
strategic plan for every donor because it
focuses, holds accountable and provides
a clear path for the fundraiser to develop
strong relationships with the donor. The
result of developing those relationships is
a closed gift.

In every situation we’ve encountered
where the PGO has a strong relationship
with their donors, it’s because they’ve had
a strategic plan in place for that donor,
designed to build trust between the
donor and the organization.

Every donor plan a PGO creates should
include a series of touch points designed
to thank the donor, report back on
impact, solicit for a gift and to know what
type of gift, and create personal touches
that show the donor you know them.

Too often, when a PGO is asked to create a plan for every one of the donors in
their portfolio, they resist, saying it will take them too long to complete. That’s
just not true. In our experience, when we help a PGO create a plan, it takes
one full day of concentrated time.

That’s it!

That one day gives the PGO so much freedom because now they know what
they’re doing with every donor, every day. You now have a path for every
donor. Remember what we said above: in every situation where we saw PGO
success, it was due to the fact she had a strategic plan for that donor.

If you’re not sure what donors you’ll be cultivating today when you sit down at
your desk, it’s because you don’t have a plan. Commit yourself to creating that
plan today, and you’ll see more closed gifts and happier donors tomorrow.

S IN #5

    Marketing from a Distance
    Does your organization have stacks of outdated planned giving brochures
    gathering dust in a closet somewhere? If so, your organization isn’t alone.

    Our fifth sin, “marketing from a distance” means you’re likely using passive
    websites, preprinted brochures (discussing complex gifts no one even
    understands), direct mail and email boilerplate copy – and all the other
    collateral of the past that has mostly been ineffective, to generate leads.

    Bringing in new leads and leading those donors to making a plan gift
    needs to be strategic, intentional and personal.

    Here’s how we break it down:

     01
           Strategic — Do you know which donors in your database to target? Or
           are you just mailing everyone some generic brochure? Are you asking
           the right questions of your donors to understand their interest? Are you
           using technology to help donors self-identify their interest in making a
           planned gift?

The Seven Deadly Sins of Planned Giving                              Copyright © Veritus Group LLC 2021   13

Intentional — Have you created a marketing plan which markets the
02
most common and accessible planned gifts, focusing on simple wills
and estate plans? Remember, this is about 80% of all total planned gifts.
Be intentional about making it easy for a donor. Don’t knock them over
the head with complex information that a lawyer would have to explain.
We’ve seen too many non-profits market complex gifts with boilerplate
brochures that are cold and impersonal. This is why they’re stacked in
your closet gathering dust.

03 Personal — Talk to your donors like they’re humans, so they know that
your organization has a soul. Use language that makes everything about
the donor’s desire to make a difference because they’re moved by your
mission. Generating a lead is great; how you respond to that donor
makes all the difference. Make sure you qualify that donor, then create
a plan to understand that donor’s passions and interests. Then you can
tailor a solicitation that meets the donor’s desires. Make your marketing
and your follow up personal.

When we assess an organization’s planned giving program, part of our
work is to evaluate the source of your leads – which helps us understand the
effectiveness of your collateral material and your communication efforts. Many
non-profits are spending a ton of money on newsletters, brochures, direct mail,
etc., and they’re not generating quality leads.

You should be evaluating your program at least annually and know how
effective your lead generation strategy is. Ask yourself, “Is it strategic,
intentional and personal?” If it is, the data will back it up.

S IN #6

   No Plan for Stewardship
   When we first sat down with Bob Shafis, we asked him what was one of the
   biggest problems in planned giving that no one talks about. He said, “That’s
   easy – non-profits are notorious that once they close a gift, they basically
   forget about the donor.”

   He went on to say that all of the current research is showing that, of the
   donors who make a planned gift and leave an organization in their estate
   plans, 50% of them change it 2-3 years before they pass away.

   We couldn’t believe it. These organizations and PGOs who are doing all this
   hard work to bring in leads, cultivate the donor and finally book a planned gift
   – half of them will see the gifts go away?!?

   Why is this happening?

   It’s a classic answer. You’re not telling the donor how they’re making a
   difference; you’re not spending time continuing to steward the relationship;
   you’re not keeping the donor connected to why they made that gift in the
   first place.

   Basically, you pocket the “deal” or the money and you move on. What a waste!

The Seven Deadly Sins of Planned Giving                             Copyright © Veritus Group LLC 2021   15

Now, you may say you have a legacy society, but truth be told, most of those
legacy societies do very little to steward a donor. Maybe you invite them
to a boxed lunch once a year, but rarely do we see much time, energy and
commitment to maintaining a relationship.

Think about this for a minute. Let’s say you have $10 million booked in estate
gifts for your organization. $5 million may go away by not properly stewarding
that donors related to that $10 million. Wouldn’t you invest in a proper
stewardship program to make sure you actually realize that $10 million?

We would advocate that, along with your planned giving officer who is
excellent at cultivating donors, forming relationships and booking gifts, you
should also hire a planned giving associate who is responsible for making
sure that all planned giving donors are being properly stewarded.

In fact, every donor should have a complete annual stewardship plan
attached to them, where you’re engaging with them on a regular basis.

Here’s another thing: If you don’t do this, you may actually be committing two
sins here. Another study shows that once somebody has made a planned gift,
they become BETTER donors to the organization. This means not only will you
preserve the commitment the donor made for an estate gift, but you’ll also
see more current cash gifts and/or an increased planned gift.

The bottom line is this: Investing in
stewardship should mean you’re willing to
dedicate the resources to create individual
plans for donors, keep them connected and
informed, and recognize them properly for
leaving part of their legacy to further your
mission.

Remember, if you do nothing, you could
quite possibly lose over half of the revenue
that you think you’ll get from planned gifts
right now. For a relatively small investment,
you could assure that most of those booked
planned gifts will stay with you.

It’s a no-brainer.

S IN #7

   Over-emphasizing
   Professional Advisors
   Bob Shafis gets really animated about this sin of planned giving. He says:
   “Look, if the staff is spending more than 10% of their time courting advisors,
   it’s way off focus and a waste of time!”

   He told us about one development director he knew who was reviewing the
   monthly contact report of the Planned Giving Officer. Most of the contacts
   were with professional advisors, such as lawyers and financial planners. The
   PGO told the development director that this was the key to planned giving
   fundraising success: that the professional advisor, once told about the great
   things at their charity, will simply advise those clients to leave something in
   their plans to the charity.

   Yep, nice idea, Robert says. But this is a common and expensive
   misconception.

   Sure, there’s a place for working with professional advisors in a planned giving
   program, but it should focus on getting them to help the PGO with technical
   questions, or as a person to put on a list of local counsel for donors, and to

The Seven Deadly Sins of Planned Giving                              Copyright © Veritus Group LLC 2021   17

help with marketing, seminars and policies. Lawyers
should never advise their clients to choose a charity
just because they’re connected to it. Most professionals If a PGO is
won’t tell the charity the name of any clients who have spending more
remembered a charity in their plans, removing any
than about
opportunity to steward the person.
10% of their
If a PGO is spending more than about 10% of their time time courting
courting professionals, it is time ill-spent. The primary professionals, it is
job for a PGO is to build relationships, and to get the
time ill-spent.
information needed to generate a personal gift plan
which is responsive to the needs of the donor and their
family. Courting professionals won’t replace getting to
know donors and asking them to support the charity they love.

So, there you have it. The 7 Deadly Sins of Planned Giving. If even one of these
areas is in disrepair in your organization, you must take steps to repair it or get
help. And we would be glad to help you. Just contact us.

And remember, planned giving is a HUGE net revenue producer for your
organization. It’s worth doing right not only from an economic point of view
but also because it gives your good donors an additional way to fulfill their
passions and interests.

Veritus Group is a full-service mid, major and planned gift consulting agency serving non-
profits all over the world. We help create, build and manage major gift, mid-level and
planned giving programs by combining donor-centered strategy with solid management
that is focused on accountability.
You can reach us on the Web at www.veritusgroup.com or by contacting contacting Amy
Chapman at 215-514-0600 or achapman@veritusgroup.com
More White Papers like these are available for free at www.veritusgroup.com/category/
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