Time for action! Why we have to invest in sustainable legacy fundraising

Published by Lena Vizy on August 1, 2019August 1, 2019

It’s 2019 and every fundraiser has heard about legacy fundraising. Every fundraising director or manager knows that legacy fundraising is part of a balanced and successful fundraising mix. Research, analyses and forecasting predicts that legacy giving has a huge potential and can create enormous income for the whole charity sector in the upcoming years. Research by Professor Russell James, Texas Tech University, shows that the future is bright. We should expect that we are on nothing but an upward trajectory for the next 20-25 years.

The largest intergenerational transfer of wealth in human history will take place in the upcoming years. An estimated $46 trillion that is in the hands of the baby boomer generation will be passed down. In the Netherlands the 100th largest charities received €311 million in 2016. Legacies are 27% of all private fundraising income. The lifetime value of a monthly donor, for example in the US, is in average $795. If you compare this to the average value of a legacy which is in average $35,000, nobody needs to be convinced that legacy giving is something you have to invest in.

But there is something wrong within our sector. It has never been a better time to focus on legacy giving but most of the NGOs and charities on the European continent are still investing way too little in legacy fundraising. For example in the Dutch sector, just a very small percentage of all fundraising budget is invested in legacy fundraising. In fundraising teams often a very small capacity is allocated to legacy giving, compared to the other fundraising streams, like for example major donors or events.

Why is legacy fundraising, with all the huge potential, still so underdeveloped?

1. Managers invest more in short-term and less in long-term money. The amazing long-term return of legacy giving is often sacrificed for a much lesser short-term gain. From my perspective this action is highly unprofessional and harmful for our organisations. Every manager will end up wishing their predecessors had invested in legacy fundraising earlier and more sustainably.
2. Yet many charities are all too often unsure about how to talk to their supporters about legacy fundraising. Employees, managers, boards or directors often do not feel at ease talking about legacy giving and still believe conversations are about death. The opposite is usually true. Legacy giving is all about life, the donors’ values, memories, dreams, ambitions and aims.
3. Often charities and their management still have a lack of knowledge of legacy fundraising. They either think it is simply about making leaflets and leaving those at a notary, lawyer’s office, or the opposite: they think that it needs huge budgets, big campaigns and expensive specialists to start with legacy fundraising. Resulting in both cases in a not sustainably implemented legacy fundraising.

In times when a whole sector is searching for innovation and brilliant new ideas that will ensure organisations receive millions of future income, most of the charities on the European continent poorly neglect the potential that’s right in front of them. In an increasingly challenging fundraising environment, legacy giving remains a vital source of income. At this moment there is no fundraising tool, event or technology that can take the place of an effective and sustainable legacy fundraising programme for your organisation. At the moment there is in fact no fundraising method that has a better ROI.

So how can we build a sustainable legacy programme? What are the corner stones?

It’s important that organisations fully understand that legacy fundraising is not about the financial transaction happening. You can’t apply the same logic you do to a cash appeal. It’s about a value transference. Everyone wants to make a long term difference. For all of us there comes a moment when you look back on your life and think about the impact you had and what you will leave behind. That’s when people are looking for organisations that match up with their values to consider leaving a legacy. At that moment it‘s all about connection and trust. Donors are not looking for a legal solution, they are looking for something to believe in.

With consistency, both within individual charities and as a wider sector, the potential of legacy fundraising can unfold in combination with knowledge and skilled people.

Key indicators of a sustainable legacy programme are:

• A strong culture of legacy giving throughout and within your whole organisation. A legacy programme that is isolated will fail. Connect and integrate with other communications and fundraising programmes. Educate your colleagues and managers about legacy fundraising. 
• A stable, ongoing legacy programme with strategy and adequate budget. Invest consistently because short-term thinking now kills major future funding later.
• Inspiring legacy fundraising communication creating connection and trust. Do not get lost in technical or legal advice at the expense of inspiration.
• Regular prospect identification and donor acquisition that brings in the right leads and follow-ups with consistency. 
• High donor loyalty and long term stewardship to keep your pledgers.
• National campaigns and initiatives that create visibility and stimulate legacy giving to a wider audience than only your supporters or donors.

Do you want to learn more about legacy fundraising and build or fine tune your organisation’s legacy programme? Join my legacy fundraising masterclass and workshop at IFC 2019.