Does your church have a sizeable endowment?
Don’t worry – if the answer is no, you certainly are not alone. Often our church stewardship plans are annually focused: we’re striving to make ends meet in the current budget year. We’re scrambling to secure the funds for a building or other capital project. Seeking ways to build a legacy fund or endowment for the future falls by the wayside for most ministries.
In this blog series, we’re exploring creative giving tools for churches. We’re unpacked what churches need to know about non-cash giving, cryptocurrency, and today we’ll look at the long-term strategy of planned gifts.
What do I mean by planned gift? Typically, this is a legacy gift that a donor outlines in his or her estate plan and is given in death. There are many types of planned giving vehicles (some donors can give during their lifetimes, such as charitable gift annuities) but today, we’ll focus on the most common and simple ways your church’s members can make a lasting impact on your church long after their passing.
Pastors, the easiest place to begin is by asking your church members to consider leaving a gift in their wills and estate plans. Contributions from wills and estates tend to be much larger than what donors could give in their lifetimes. Encourage your congregation to consider including the church as a beneficiary when they outline or restructure their wills.
One organization made the commitment not to spend the funding from any planned gifts they received that didn’t have specific restrictions. Instead, they allocated those church contributions to their endowment fund. By not spending any of the sizeable gifts they received over a period of several years, they were able to establish a significant endowment to support the church and its ministries. This approach also honored the intention and legacy of the donors whose final gifts made it possible.
Insurance policies and retirement accounts are other tools for creative giving. These can enable donors who couldn’t make major gifts in their lifetime to make a generous contribution in death. Donors simply need to designate the church as a beneficiary of a life insurance policy or for their IRA or retirement account funds.
Of course, donors can also leave property or other valued assets to the church as part of their bequest and estate plan. But the only way to begin seeing gifts of this type is to communicate to your church members the importance of these options.
One pastor recently shared with me how when one of his long-standing members passed away, the obituary notice asked for contributions in his memory to several charitable organizations – but not to the church, where he’d been active and where the memorial service was held. While these things will happen, we can increase the chances of our members making their church as part of their legacy giving at the end of their life by talking about it as a congregation now.
Build strategic communications to your members sharing how important planned gifts are for the future of your church. Ideally, pastors, ask one of your members who has an estate gift in place to share his or her story. Or perhaps you have a choir room, library or other place/item in your church named for a beloved member whose bequest funded the gift. Tell that story and paint a picture of what’s possible when donors fund their passion with proceeds from their assets.
Some churches also host occasional planned giving workshops for their members. A trusted partner with expertise in these tools can provide important and timely information about tax implications and how to best structure a basic will and estate plan. Those sessions can give you as a pastor the opportunity to deepen your relationships with those planning for that season…those workshops can also broaden your own understanding of ways to communicate to donors about legacy giving options.
Again, don’t feel like you have to learn all there is to know about these or more complicated giving tools. ACS Technologies is here to help answer your questions, and provide you with church-giving tools if you need help.
In this series, we’ve covered the fundamental – and simple – tools that will make a significant difference in your stewardship program. Focusing on even a couple of those creative tools at year-end and in 2022 will bless your ministry…and your donors.
Tim Smith has over 30 years of experience in Church, Non-Profit Administration, Management, and Fund Development. Serving as an Executive Pastor and Chief Development Officer in growing Churches and Non-Profit Organizations has provided a wide range of expertise and resources. Tim serves as Founder and CEO for Non-Profit DNA, a boutique firm committed to helping nonprofits and churches build their capacity through fundraising, leadership, team building, staff recruiting, and coaching.