Relying on tax-deductions to motivate charitable donations? Think again!

Posted by Kevin D. Feldman in fundraising

The more money that individuals and companies have in their pockets, the better it is for charities, period. If you are a fundraising professional or nonprofit who is relying on tax deductions as a motivator for donations to your charity, then you are not doing what you should to become sustainable. That is…

  • to have programs that are always working to achieve greater and lasting results (donors give for results)
  • maximize the use of every marketing and communications channel to communicate those results, and engage donors and prospects
  • set out to treat ALL donors and volunteers as if they are major donors (you will never know the sacrifice that some are making to make a small gift to support your work)
  • encourage monthly giving, no matter how small the gift
  • seek out opportunities to engage and recruit volunteers to bring donors and outsiders closer to you nonprofit and its work
  • leverage Board, Associate Board, staff, donor and volunteer relationships to expand the organization’s network of constituents
  • set your development staff free to engage the public and build relationships
  • create an entrepreneurial work environment where ALL ideas for improvement and opportunities are welcomed and discussed (remember the ALS “Ice Bucket Challenge”?)
  • work your database to include all of the organization’s relationships, and record as much information about individual, corporate and foundation donors, volunteers, staff and others that is necessary to build growing and lasting relationships (done correctly, your DRM will be a modern-day goldmine)
  • listen to donors, volunteers and others, and fashion your communications to represent their interests and passions
  • using this information, never stop matching donors and prospects with the nonprofit’s needs and visions
  • create and/or build the organization’s endowment.

Asking for the gift becomes less intimidating and more strategic when this to-do list is followed. You will also find that your nonprofit will become less dependent on government funding and tax-deductions to sustain your work.

In 2018 I will take each of these bullet points and address them separately. I look forward to your feedback. Happy New Year!

“Crisis of the Ages” Averted: How Nonprofits Can Survive and Prosper

Posted by Kevin D. Feldman in Crisis Management, Endowment, fundraising, Planned Giving, Stewardship, Strategic Planning and tagged with , , , , , , , , , ,

laughing from the bankLast month I alerted you to a coming crisis that will befall nonprofits and businesses in general. You can read about it here Crisis of the Ages … Is Your Nonprofit Ready?.

I promised that I would provide you with ideas that will help nonprofits to withstand the crisis, and possibly help organizations to thrive during this critical time in our history.

In 1989 When I left the for-profit world and ventured off into the world of nonprofit management and fundraising, there wasn’t much being said about planned gifts at that time. Nonprofits gladly accepted bequests as their donors passed away, but those gifts were few and far between. The majority of nonprofits, except for colleges and hospitals, didn’t have planned giving as part of their overall proactive development strategy.

Then in the mid-1990s while serving as Director of Development for a Detroit, Michigan-based nonprofit, the good folks at Indiana University School of Philanthropy (now the Lilly Family School of Philanthropy) invited me to attend a series of seminars focused on major gifts, endowment and planned gift fundraising. These were terrific experiences! This was also the first time that I heard anything about the fast-approaching wealth transfer/planned giving opportunities.

The aging Baby Boomers are presenting the largest wealth transfer in history with an estimated $41 trillion dollars in wealth being transferred before the year 2052. Learn more about this wealth transfer and its opportunities for planned gifts by reading Wealth Transfer Report from Boston College.

Fast forward to today, and in the 20 years since I first learned of this historic wealth transfer, and since then having worked with many consultants who were advising the nonprofits I served on matters of planned giving and major gifts, not once did these consultants ever suggest what the nonprofits should do with the planned gifts as they are received, nor did they warn of what was coming after the end of The Great Wealth Transfer in 2052. Unfortunately, many nonprofit consulting firms, like many businesses, tell their customers what they want to hear. Nonprofit leaders are eager to learn how they can raise more money, but do not like being told how to use the funds they’ve raised.

What can nonprofits do now to be prepared for the forthcoming crisis?

First, every nonprofit small and large should have their own endowment. I learned this 20 years ago. And as often as I have advised nonprofit CEOs and Boards to establish an endowment, most were concerned only for today figuring that any huge benefit from an endowment wouldn’t occur until there was another Board and CEO in charge. So if your nonprofit doesn’t have an endowment — create one soon!

Second, make it a policy that as planned gifts are fulfilled the money is invested in the nonprofit’s endowment — that is unless the donor designates his/her planned gift for another purpose. You will be surprised how quickly the endowment will grow, and how it can provide revenue that the organization can use both now for its programs and later in response to a crisis.

You will find that your donors love this idea, and that the number of planned gifts will grow because of it. After all, a planned gift is a donor’s way of leaving a positive legacy. The way that many nonprofits spend their planned gifts, “the legacy” lasts only as long as the money. Once the money is spent, the legacy ends. If the donor’s planned gift is invested into an endowment, the money not only remains indefinitely, but grows over time with some of it that can be used now and every year to serve the cause so near and dear to the donor’s heart. Now that’s a legacy!

Imagine how much money will be in your nonprofit’s endowment by year 2052 if your planned gifts are being invested into it. Imagine how much money there would be now, had your nonprofit began investing its planned gifts in its endowment 20 years ago! If you do this now, when this historic crisis hits, your nonprofit will be best prepared to withstand it — and maybe even prosper through it!

Crisis of the Ages … Is Your Nonprofit Ready?

Posted by Kevin D. Feldman in Strategic Planning and tagged with , , , , , , ,

older man - young woman

By Kevin D. Feldman

The largest generation of people in World history is aging and with many outliving their retirement resources because they are living longer than projected by their retirement plans. Those who were once generous givers, may no longer be able to give.

The shrinking numbers of the generations that follow will hardly be able to replace the “Baby Boomers” of yesterday. There will be a shrinking pool of individual donors and prospects because of this. The competition for the donated dollar will become fierce. 

Employers will be scrambling in search of qualified employees in a shrinking workforce. It is likely that many businesses will fail due to the shrinking number of consumers and lack of available workers. Corporate wealth may be stretched to its limits as companies consolidate to reduce expenses and adapt to the forthcoming decline is sales and worker shortages. The businesses that survive and were once generous donors and sponsors to nonprofits may have to reduce their levels of giving or stop giving altogether.

This historic contrast in demographics and world population levels will mean fewer people and companies to support the nonprofits that exist today, as well as those of tomorrow. The lack of needed nonprofits means a shortage of vital services to individuals, families, the environment, and much more.

A crisis awaits.

Is your nonprofit ready? If so, what has it done to prepare for this crisis? What are you doing now to prepare?

I have my own ideas that I will share with you in an upcoming post.

Why Your Organization’s Guidestar Profile Really, Really Matters

Posted by Kevin D. Feldman in Uncategorized

There are a number of reasons why your organization MUST keep its Guidestar profile compelling and fresh. For the nonprofits that have not yet created a Guidestar profile (and I know you are out there), THIS IS YOUR WAKEUP CALL! For those nonprofits that have spent minimal time maintaining their profile on Guidestar, it is time to take it seriously and invest in it.
Here’s one reason why:
If you are like me and stay current on the latest news in philanthropy, you have likely read the many reports on the growth of donor-advised funds, and in particular Fidelity Charitable — both in contributions to its donor advised funds and gifts made from the funds to thousands of charities. In 2013, gifts to donor-advised funds held by Fidelity Charitable grew by 12%, bringing the total to $3.7 billion in giving for the year. Assets held by Fidelity Charitable in 2013 totalled $54 billion. More amazing is that in the first nine months of 2014, gifts to these funds grew by a whopping 57%, with almost $2 billion given to charities so far this year. And the year-end giving season is about to begin!
What does this mean for my nonprofit? What does my organization’s Guidestar profile have to do with this you ask???

How does a super-strong year end sound?

Now, drop everything you’re doing and visit FidelityCharitable.org. You will notice on the homepage links in both the top right and lower left corners to search and research charities. Both of these links lead to Guidestar.org.

Because of the tremendous growth of assets in Fidelity Charitable donor-advised funds due to increasing contributions and a strong economy, owners of these funds will be looking for ways to grow their giving from them. For some this will mean researching new nonprofit organizations to support — particularly those nonprofits that are achieving desired results serving the causes that are near and dear to donors’ hearts.

Is your organization’s Guidestar profile compelling and up-to-date?

Will your year-end appeal contain an ask for donors and prospects to consider making a gift from their donor-advised fund?

Do you have a special way to acknowledge your donors from these funds?

Before Thanksgiving, make it a priority to take advantage of this outstanding opportunity for a strong finish to 2014. Create or update your Guidstar profile, and put your organization’s best foot forward. Right now, I can’t think of a better way to spend your time.FidelityCharitableGiving-Report-2014

What we “do unto others” can make or break your development strategy

Posted by Kevin D. Feldman in Uncategorized and tagged with , , , , , , , , , , ,

The “golden rule” for nonprofit FundAbility is the same as the “Golden Rule” for living, “Do unto others as you would have them do unto you.” To behave any other way is not only shortsighted, but will cost a nonprofit organization potentially hundreds, if not thousands of new donors — some of them having the capacity to make large gifts.

As leaders of nonprofit organizations large and small, we should set high standards for how our employees and volunteers interact with others, and train them to follow these standards. Ask yourself, “How is our receptionist greeting people as they walk through the door?” “How are we treating our vendors, the mail carrier, and restaurant staff?” “How do we treat our own employees — and how do they treat each other?”

With unemployment rates at historic levels, no doubt your nonprofit has seen an increase in the number of job applicants. How are you treating them? If you do not believe that some of these applicants are your donors, sons and daughters of donors, or potential donors — you are wrong!

For an Executive Director, HR representative or hiring manager to ignore job applicants by not following up with a letter, phone call or email to say “thank you” is narrow-minded at best. Most charities that I know of would never think of searching an applicant’s name through their database of donors … but they should! Even if the applicant’s name is not in the donor database, do not count them out as part of your organization’s donor acquisition strategy?

I had served a large international charity for several years and got to know the major gift officers rather well. One of the gift officers had been a major donor to the nonprofit before selling his business and working for the charity full-time. He continued making large gifts to the organization while in its employ.

Message to nonprofit leaders: “Never underestimate the value of job applicants and others to the future of your organization.”

Welcome to FundAbilityRules

Posted by Kevin D. Feldman in Uncategorized and tagged with , , , , , , , , , , ,

Dear Friends,

Welcome to my website, “FundAbilityRules.com”

FundAbilityRules is devoted to holistic approaches to nonprofit advancement. Believing that every action and activity of a nonprofit will have either a positive or negative impact on the organization’s ability to raise money, I created this blog/website to help employees, Board members and volunteers take a more critical and introspective look at their entire nonprofit operation.

You are welcome to participate, so that together we can discover root causes for our organizations’ revenue problems, as well as find new pathways to success.

Thank you!

Kevin D. Feldman