Family Discussions – Don’t Wait Until It’s Too Late

I have the opportunity to speak with people of all ages, professions, and interests each year about their estate and philanthropic planning. I usually begin by asking them questions about themselves and their family. If the client is retired, I’ll  ask what they did when they were working, how many children they have, and so on.

To simply ask how to divide their possessions, or to give directly to charity, invites problems. They will most likely answer: “I would like to leave everything to my children equally after we’re gone.”

Once I was having an interesting conversation with new clients, spending  time asking them questions about their history, children and grandchildren. The  husband stopped me to ask why was I spending so much time trying to learn about his family members.

I said to him, if I don’t know this information how can I create a philanthropic plan that’s going to work for you and your children?

Let me give you an example. Suppose Johnson has built a family business over the course of many years. The equity and value in the family business makes up a large chunk of Johnson’s family net worth. Let’s assume Johnson has three children, only one who works in the business. Johnson tells me that there is some acrimony between the son who works in the business and another son who does not.

If Johnson simply divides his net worth among the three children, what problems might occur?  What is the likelihood of Johnson ever making a current donation or a charitable bequest?

In working an estate with a current donation and/or estate bequest, an appropriate solution can only be found if everyone is willing to have   difficult conversations and potentially, disagreements. It’s okay to have disagreements during the planning stage. What every family doesn’t want is to have disagreements once it’s too late.

Please contact me to discuss how to initiate these discussions with your family, develop a healthy relationship, and leave a legacy that everyone will be pleased with.

William Petruck
President and CEO
FUNDING matters Inc.
Toll free:  1-800-856-1354

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https://www.theglobeandmail.com/investing/globe-wealth/article-family-meetings-emerging-as-a-new-facet-of-financial-planning/

We’re Way Past Quitters’ Day – Now What?

We are only a few weeks into the new year, yet 10 days ago was Quitters’ Day, the day people are most likely to give up on their New Year’s resolutions.

We make resolutions because we want to improve. None of us want to fail, yet many of us end up falling short. One of the primary reasons why our steps for success aren’t sufficient is because we have no strategy. Our plans often fail because our good intentions aren’t good enough, and we need more than drive and determination. We all need a game plan.

Despite our desire to make good financial decisions, many of us don’t know how to make these life-altering choices efficiently. Even knowing where to start can be a challenge, which makes it tempting to lose hope.

Giftabulator NOW is the app to guide you through your estate and financial planning, no matter what stage you’re at. If you need help making long-term financial decisions, Giftabulator makes planning intuitive so you don’t have to be burdened with financial confusion.

It’s now easier than ever for families and donors to make financial moves in the right direction. Giftabulator removes the complications that individuals run into while trying to overcome common obstacles. After answering a few simple financial questions, the app can illustrate users’ current financial state and offers specific advice to plan for the future. Charities can use the app to help potential donors realize their true philanthropic potential. Giftabulator combines many of the tools used by affluent individuals, and makes them affordable and highly accessible. With an informative app that can be accessed at any time, financial decision-making can now be a smooth process for everyone.

It’s time to eliminate the barriers that stop most people from getting the financial know-how they need. Try Giftabulator to take another worry off your nagging to-do list of resolutions, a decision to start your year off the right way. Designed to protect your future, Giftabulator will ensure that you have one less issue to overthink so that you can have peace of mind for years to come.

– Bill

This holiday season, give the gift of charity

The holiday season is at its height, making it the best time of year to give back. If you’ve thought about donating to a charity or an organization that has special meaning to you, you can make a difference without putting a strain on your wallet.

Before you sell your securities…

In the world of philanthropy, cash is not always king. Before selling your stocks to give a cash donation, consider gifting your stocks instead. Selling your appreciated assets will leave you paying capital gains taxes. Choosing to gift stocks to the charity of your choice will give you a tax reduction, and you can avoid paying a capital gains tax in the process. This can also lead to a reduction in your taxable estate, depending on the size and type of your gift.

Discover your philanthropic potential

Deciding on the the right amount and type of charitable gift you would like to give can be challenging. If you haven’t decided on the details of your gift, try a useful philanthropic giving app, Giftabulator NOW (showcasing our friends at the Shevchenko Foundation). Find out your giving capacity to maximize your money’s impact—the smart way to give this season.

Give while the season’s in full swing

If you’re looking to contribute to a good cause before the holiday season ends, don’t delay. Speak with your accountant, lawyer, or financial advisor at least a week before December ends. Have your donation in writing so everything can be processed before the year ends.

Feel good about your positive impact on those you care about most, and enjoy the peace of mind that comes with the financial benefits of charitable giving this tax season.

Merry Christmas and Happy Holidays,

– Bill

The Ikea-Inspired Guide to Fundraising

I really like Ikea because its success is a combination of affordable prices, cool designs, ease of purchasing and simplicity in assembly.

But it seems that the design of each Ikea store is created to confuse you. Walking up and down the aisles takes you from the bedroom section to the living room section to the kitchen section. Then you have to self-serve by awkwardly lifting packaged disassembled furniture. Every time, I feel like I am undertaking an adventure in looking for things that I don’t necessarily need. But for some reason when I come across an item that I have not seen before, I am tempted to pick it up and put it in my buggy.

One particular thing I love about Ikea is how they provide the owner step-by-step instructions for the new item, along with an allen key to assemble pieces together.

I came to realize that the principles for assembling Ikea furniture are similar to those for executing a successful fundraising campaign, particularly our 7 Step Power Donor System for major and planned giving. So in the spirit of Ikea furniture assembly, here is a simple Ikea-inspired 7 step guide to raising funds.

The 7 Step Guide to Raising Funds

Step 1Brainstorming

As part of the DIY (Do It Yourself) process, the most essential starting point is making sure you have the right tools and materials. For Ikea, these would be packaged screws, boards and other items like the wooden pegs. For fundraising, it is a checklist of action items which will help you review the past, present and future of the charity. Brainstorming will help you prepare for the budding campaign by setting up:

  • Clear Case for Support
  • Navigable website
  • Useful Giving tools
  • Strong Organizational commitment

In order to have those in place you need to have answers to the following questions:

  • How much money do you need?
  • How much do you need now?
  • How much will you need in 12 months?
  • How much will you need as an endowment?

Step 2 – Research & Identification

Now that you have all the right tools, you have to match them with the assembly pieces that you’ve been given. In the realm of fundraising, you need to use your database to organize the campaign and get your prospects in one place.

Step 3 – Connecting the Dots

Your actions should be part of a strategy that align with the instructions. This would require reading through instructions to complete the piece of furniture. In fundraising terms, this would require preparing the plan to approach your prospects. You will have to ask yourself the following questions:

  • Why do you need the funding?
  • How will it be used?
  • What is the impact of the funding?
  • How will it be measured?
  • Who will be involved?

Connectors will better understand the cause and be more willing to join the leadership team with these questions answered.

Step 4 – Develop a Customized Strategy

The saying “No man is an island” holds true for both furniture assembly and fundraising. In furniture assembly, you usually need someone to help you hold pieces together or make sure you are following the instructions correctly. In fundraising, it’s all about putting the leadership team together and getting them engaged in the project. During this process you need to get input from individuals who are not necessarily involved in the organization. These individuals will help you answer key questions such as:

  • What types of materials will help you approach prospects?
  • How will you portray the campaign?
  • How will you customize materials to better reach your target audience?

Step 5 – Leveraging Your Team’s Capabilities

When it comes to Ikea furniture, I make sure that my wife or one of my kids isn’t too far away to help me with the assembly. Similarly, you need to have your leadership team ready to use their networks and reach out to prospects. Leverage is all about having the right leadership team to help you in the process. Afterwards, you can start assessing your capabilities of connecting with your donors:

  • How will you reach out to your donors?
  • How will you identify new donors?
  • How will you follow up with these individuals?
  • How will you engage them?
  • How will you bring them to understand the benefits associated with donating to your organization?

Step 6Alliance

You’re almost there! Your furniture is starting to come together. Make sure you check off all the details to avoid a wobbly chair or a dangerous nail pointing out the back of your bookshelf.

In fundraising, the final touches of a major gift campaign are all about keeping people informed and recognized for their contributions. This usually takes place in the form of:

  • Engagement with professional advisors to explain the benefits of donating (e.g. via stocks, equities, publicly traded shares, mutual funds, RRSPs/RRIFs)
  • Donor recognition
  • Follow up with donors and key stakeholders

Step 7 – Close

Closing in furniture assembly and fundraising is making sure that there are no loose ends. This step involves finalizing donor agreements and receiving donation funds.

You’re done! You can enjoy your new furniture and your new fundraising campaign!

Correlation Between Grade Grubbing and Successful Major Gift Fundraising

We’ve all heard the term Grade Grubbing, or Grade Lawyering, or even worse – Grade Begging. I must confess, I was a Grade Grubber. I mentioned this to my colleagues at FUNDING matters last month. The focus of the discussion was about major gift fundraisers or fundraising volunteers. I mentioned that these individuals need to be able to assess donor situations on many different levels and perspectives in order to make an initial approach. This brought me to the realization that, sometimes when it comes to explaining fundraising principles like donor engagement, it works better to draw on personal experience not necessarily related to fundraising. You might be asking yourself to which past experiences am I referring. As you can tell by the title of this blog entry, it is my time spent though the primary, secondary and postsecondary education system.

Grade Grubbing is often looked at in a negative context by fellow students and especially by faculty and administration – but it shouldn’t be. Our education system isn’t just about writing essays and tests, it is also about getting along with people. I always felt that I could do a little bit better by approaching my teachers or professors after I had received a mark on a paper or test.

So this is Grade Grubbing 101: After receiving a mark, I would carefully review my work and find areas where I could increase it. The rule of thumb was that if the mark was anywhere between a failure or I clearly did not demonstrate effort on my part, I would not grade grub.

A fundraiser should follow a similar rule. If they don’t put the effort and strategy into a proper presentation to a prospective donor, they should not even approach the prospect. Lack of proper research and due diligence is often why donors agree to lesser amounts.

My on-going efforts to engage in conversations have served me well both as a student and as a fundraiser. As a fundraiser, this skill translated into a considerable amount of money for various causes. As a student, the personal connections with my teachers benefited me the most. What helped me forge those connections was the fact that I showed up to class and I submitted my work on time. The key point is that I was consistent and took every opportunity to advance my cause. Surprisingly I actually liked doing this, and I know that it created a good rapport with my grade reviewers.

When it comes to fundraising, persistent contact over time encourages the donor to consider increasing their donation to a major or transformational level. Never in my experience has a donor immediately agreed to give the full sum of the ask. There is a very nuanced dialogue that takes place. It may involve different approaches, views and strategies to get to a place where the donor is completely satisfied and comfortable, which in the long run helps an organization achieve its objectives.

If you like this blog share it with others. Or better still, share your own experience that shaped your personal approach to philanthropic conversations.

– Bill

I Hate Wearing Rubber Boots

I was driving home yesterday and saw a man walking up the street wearing a t-shirt that read “I HATE WEARING RUBBER BOOTS” while he was wearing rubber boots. Charities and the people who work in fundraising metaphorically face a similar situation. Instead they are wearing t-shirts with a slogan “I HATE ASKING FOR MONEY”.

In our industry we are still pushing envelopes into people’s mailboxes, reaching out through social media, organizing galas and walk-a-thons and other events that only have modest success in raising money. All of these approaches are high in cost and low in ROI, when considering how much an organization must pay for their staff time and the elements of a direct mail piece or a gala or other event.

It seems like fundraisers gravitate towards having events but hate asking for money. I have also heard from many in the industry that  they hate fundraising events but do them anyway.  What fundraisers don’t seem to like is getting in front of donors and selling their case by using the opportunities to educate the donors on how they benefit by using taxable assets when donating to charities.

The relationship between donors and fundraisers needs to be one that is long term in order to be truly effective, and there needs to be better communication between charities and donors.

Often only big institutions such as teaching hospitals and world class universities have tapped into sophisticated approaches which discuss strategic philanthropy as part of selling their case. Most other charities are still planning their next walks or galas. At some point board members should figure out that the return on the investment in staff time and cost associated with these types of “fundraising” activities generate a very high fundraising cost and a low ROI.

Financial service companies and wealth management firms already educate individuals about philanthropic planning. However, their approach is strictly to preserve assets for their clients by minimizing taxation. This is something charities have been shying away from over the years. Only recently have they become more interested in speaking to their constituents about estate planning.

Charities need to develop methods to facilitate conversations with individuals about funding which incorporate education which will show them the benefit in their philanthropy.  This should be a wake up call to all board members and fundraisers to become educated in the best ways to engage with their donors in order to give them the biggest bang for their buck when donating.

More resources should be invested in training and technology to assist fundraisers to be better at what they do and then their metaphorical t-shirt slogan can be “I LIKE ASKING FOR MONEY!”

– Bill

Estate Planning As A Part of Strategic Philanthropic Giving

Estate planning can be your unique selling proposition to encourage philanthropy. When you look at individuals who are significant donors to charities, many of them have already written wills and established financial plans. This type of planning allows them to support their favourite causes by following their strategic philanthropic plan.

Strategic philanthropy usually takes place between family members, financial advisors, tax and legal planners. Just as important as retirement planning, a philanthropic plan can be drafted in tandem with the development of an estate and financial plan to include charitable giving in the present and in the future.

Recently, Imagine Canada made recommendations in their Personal Philanthropy Project. The aim of the study was to look into philanthropy among affluent donors.  The key recommendations within the Imagine Canada report highlights four areas for action. I will address one of the recommended action items – the development of a giving calculator which enables individuals to understand the best ways to give. The other three action items have been applied by charities over the years to increase giving to major gift campaigns with consistent levels of donor engagement such as “predetermined giving tiers” and “peer influence”. Unfortunately, these actions bring success, usually occurring in larger organizations with well trained volunteers and senior staff helping to guide the process.  What happens in the small to medium sized charitable organizations, how can they compete? The great equalizer is education through illustration of different donation scenarios.

I classify the majority of charity donors as “transactional donors”.  The word “transactional” refers to charitable giving in the form or cash, check or credit card. This is typically in the comfort zone for most donors.

Meanwhile, a giving calculator can benefit the following groups: 1) the individual donor and their families; 2) the individual’s advisors (tax planner, financial advisor and legal advisor); 3) the charity and its leadership team because it can illustrate the best ways to give from assets that are highly taxable. To name a few, assets such as stocks, mutual funds, and registered investments are good vehicles that provide the donor with the maximum tax relief of assets with taxable capital gains. The integrated approach of estate planning, guided by the demonstrations in the giving calculator, will result in a larger philanthropic donation.

Check out our very own giving calculator, Giftabulator®, for the best ways to give by visiting www.giftabulator.com

– Bill

FUNDING matters – 20 Years of Success

Last month was a great one for me. I noticed a number of individuals who liked or congratulated me on Linkedin and Facebook in celebration of FUNDING matters Inc.’s 20th anniversary and it reminded me of how far along I’ve come since its inception.

I would like to give you an idea of what running FUNDING matters Inc. has taught me.

I am no different than any other person who has been given the opportunity to be a part of societal change.  Ever since I started working with charities, the biggest fear continues to be not meeting the expectations and results of organizations I serve.

The challenge each client has is unique. Therefore, we have to customize our solutions.

The key is being able to think outside of the box and use the 20 years’ worth of experience to move in the right direction. Often what people think is a good solution for a charity is not necessary the best option. For example, you might think that an individual gives to a charity because the person likes the initiatives that the charity represents. Of course, the initiative is of utmost importance, but donors will not agree to give before they fully understand their own financial situation. The fact of the matter is that 70% of individuals do not have an estate plan, which is why the discussion about the ramifications of their donations must happen early in the discussion. For me, that is always a topic I raise the first time I meet with a potential donor.

Because of this, in the 20 years since I started FUNDING matters Inc. I have become a better strategist for charities, their boards, their executives, and countless families and individuals with whom we interacted with regarding their philanthropy.

In many cases I give full marks to the organizations who allowed us to build our uniques strategies with and for them. Without their leap of faith in us, it would not have been possible to know if our ideas were achievable. I look forward to 20 more years of helping charities and the fundraising that is to come.

– Bill

Financial Wellness is the Cure for Philanthropy

We are all familiar with the phrase healthy, wealthy and wise. I wake up each day as do many of you thankful for our health and the opportunities ahead. We know that there are many factors which affect how we feel about ourselves, some of these factors which are out of our control and others we can do something about. Exercise, eating well, spending time with friends and family are all important activities. They also ground us and de-stress our daily lives.

One of the areas which most of us fail to address are decisions which can lead to financial success or failure. At various stages in our lives we have dealt with financing for a home, a new addition to the family, the needs of a growing family with school or aging parents. For many this consumes a great deal of their day and their lives. These factors can weigh very heavily on one’s health and normal daily activity.

For many over the age of 50 years of age, 60% do not have a current estate plan. This is a significant indicator that financial planning may not be current or in order for many of these individuals.

According to Manulfe’s Financial Wellness Index, 40% of respondents indicated they were financially unwell. Areas of concern expressed in the Study indicated they worried about debt (82%), not saving for retirement (60%) and stressed due to their financial position (67%).

This poses a very major challenge for the charitable sector. Philanthropic success for the charitable sector depends on financially well donors. That is why working with financial, tax and legal advisors for charities is essential. Charities can play a vital role in helping to initiative the discussion with their members and their advisors as financial wellness can lead to effective philanthropy. In the absence of professional advisors involvement in their clients philanthropy either in giving now or giving later the likelihood of a current donation or estate gift is remote.

Granted the number of individuals who are surveyed if they would leave an estate gift to charity is significantly higher than what is received from individuals estates (4%). The mindset of the donor can only be activated by education and illustration in what might be the ideal scenario for any such philanthropic giving.

This is a critical time for charities as they work hard at meeting budgets and building a sustainable model for their operations. If charities are to continue to do their good work, they will need to be better aligned with the understanding that they too are partners in the health and financial wellness of their donors.

Find out more at with FUNDING matters Inc. and our GiftabulatorNOW software.

– Bill

The Most Important (and Earliest) Fundraising Lesson

My earliest fundraising lesson began in 7th grade when my teacher asked the class, “Do you want basketball hoops or not?”  The answer was easy but getting there was hard.

My school did not have a gym. The closest thing it had to one was a basement. What some kids took for granted at other schools, my school learned to do without until we were given an opportunity to change all of that.

The big question was if we wanted basketball hoops, how were we to raise the money to buy them?

Fortunately, because of  our teacher’s encouragement and a parent who was willing to donate a piece of art, we had the means to hold a fundraising raffle. Quick math told us how many tickets needed to be sold in order to have enough to buy the hoops.

And so the process began.  We had to determine how quickly we had to sell these raffle tickets and who will buy them.  It was clear that my immediate clients would be my parents, grandparents, aunts and uncles.

Then who else was the obvious question.

Door to door knocking was the next step. Before I set out for ongoing disappointment and rejection, I knew that I had to have a good pitch. I needed one that was not selfish but compelling. It needed to answer why I am at a stranger’s door asking them to buy a raffle ticket for a painting, who I represent, and what the money is for. I learned that not everyone is there to support my project and not take it personally – early lesson for a 13 year old.

This approach is the one that I have used many times in my life and for every campaign I have undertaken .

The end result of the basketball hoops fundraising was a success due to our persistence. Without our active desire to make it happen, it never would have taken place.

You too have the opportunity to influence change and go after your own “basketball hoops.” It is with the same desire and convincing pitch, that our campaigns either win or lose.  Each of our organizations are worthy, important and deserve the funding they request.  It all comes down to our intense commitment to pursue our organizational and personal goals and objectives.

– Bill