It’s coming. The Big Short-age of Donors.
Follow this blog, take my courses, hear my pitches. You will get the message. This county is rapidly aging and so is your nonprofit donor base.
The Baby Boomers – the largest and wealthiest generation in U.S. history which has fueled insane growth in the nonprofit sector of over the last 20+ years – is moving into Planned Giving territory (that is the nice way to put getting old and/or dying).
This is truly bad news for most nonprofits (regardless of the fact that the overwhelming approach to dealing with one of the most obvious courses of action – Planned Giving – is to essentially to ignore it).
I finally watched the Big Short and I really related to the characters in the movie, in a stressful kind of way. They all knew they were right (about the housing bubble). They all knew they made the right investment. Yet, they were almost all sunk financially because the system refused to admit there was a problem and it was taking too long for their profits to materialize.
So, here I am. Completely invested in planned giving for over 20 years. It is the right move – the nonprofit sector WILL experience a demographic nightmare that WILL be very painful – Planned Giving is an obvious need throughout the nonprofit world. And, all I have seen is a once awesome job path completely disappear. Charities reducing investment in this area to barely anything. Consultants not booming either. Is anyone besides the bigger, more successful programs investing properly in Planned Giving or even doing anything?
In other words, nonprofit decision makers – most likely CEOs and heads of development who are under pressure to keep their jobs today by raising today dollars – have decided that the short-term goal takes complete precedence over investing in long term planned gifts (which, when received are typically multiples of your largest donors’ lifetime giving – regardless of whether it’s known leadership donor or a $50 annual fund donor).
Here is another way to look at it. In the subconscious or even right there in the conscious brain it is clear that it’s time for planned giving. But, what good will huge future windfalls (via planned gifts) do you (the person under pressure now)? Go for the $5,000 major gift now and don’t think about the $200,000 bequest (the average size for university bequest donors in FY16) or other planned gift options. Who cares if the right business decision is to actually talk to your donors about legacy giving? Your job is to keep your job today, and not make it easier for your replacement who’ll take credit for that planned gift the second you are gone!
I know this sounds like sour grapes but there is truly something akin to the Big Short going on here. Nonprofits – you are in trouble. Your biggest and best donor classes are entering their 70s. It doesn’t get better from here. Younger potential donors might not have the same commitment or financial potential. You might not even attract younger donors. The least your organization can do is intelligently make the case to your aging donors that it is also time to think about a legacy gift. That’s all.
But it does take training, staffing, and actual budgets to get it done. So, ask yourself this question: Am I going to do what is right for this organization in the long term or what’s right for me personally in the short term?