Don’t Let the Headlines Silence Your Asks: The Power of Asset Giving

What’s the difference between a membership gift and a major gift? Well many things actually, the size of the gift being the most recognizable one. But another key difference is that membership gifts are typically made with cash, while major gifts or planned gifts are often made with assets. 

Donors who make gifts of $500 or $50/month tend to have those funds available in their bank accounts or using credit cards. For a donor making a gift of $100,000, that’s not as likely (although the reward points would be considerable). Major gifts usually come from assets, most frequently stocks, Qualified Charitable Distributions from an IRA, real estate, and distributions from Donor Advised Funds.

Having the capacity for asset-based giving is an essential opportunity that nonprofits can and should cultivate. In fact, the ability of an organization to accept asset-based gifts is a significant predictor of growth. Research shows that nonprofits that promote and accept non-cash gifts actually grow much faster than those that stick mostly to cash gifts. So it is in our best interest to carefully plan our operations to let donors know we are excited and ready to accept these gifts to help move the mission forward.

But, gosh, have you seen the stock market performance right now? Market trends are understandably causing some anxiety. While it may seem counterintuitive, that’s why we need to talk to donors now. Right now. 

Here’s why: The majority of affluent people in the U.S. give to nonprofits; about 85% of those households donate. Whereas the overall percentage of all donors in the U.S. who give to nonprofits, regardless of income, has dropped to below 50%. While the performance of the S&P 500 is a key predictor of philanthropic giving, it’s not as simple as: bull market = more giving / bear market = a terrible revenue year for nonprofits. In years when the market is up, yes, giving also goes up strongly. But when the market is down, giving does not drop by the same amount. 

Right now is the time to have substantial conversations with your major and planned-giving donors and prospects to clearly communicate the value of their gift to the community. 

This is the time to be clear about the real risks stations face without full funding, and what the opportunities could be with their gift.

All of the work that you have done prior (or will do now) to understand each major donor’s particular interest(s) in your station must come to the forefront now. Your goal is to illuminate the shared values between the donor and your mission in a thoughtful, personalized way when you are speaking about their gifts. 

A donor may want to hold on to cash and prefer to give assets. A donor may be doing some strategic philanthropic planning based on taxes or other concerns. It’s not critical to understand their personal financial picture in order to have these conversations. What is critical is to let them know that you are grateful to accept asset-based gifts if that makes sense for them, and that asset-based gifts will make a significant impact. 

Economic fluctuations are challenging for fundraisers; there are many economic factors that impact donors that are completely out of our control. But there are three things that are 100% in our control:

1. Take actions to ensure each donor in your portfolio knows how important they are to your organization’s mission.
   
   
2. Work with each donor to put together a gift that is connected to their passions, works for their financial situation, and impacts the community by helping your station continue to grow.
   
   
3. Don’t let economic uncertainty deter you from asking. Don’t assume your donors can’t give now. If you hesitate out of fear of being a “bother,” you also deny passionate donors the opportunity to make a significant impact in your station’s work and in the lives of those in your community.