It’s December! What’s on your nonprofit’s holiday wish list?
How about a gift that keeps on giving…
An endowment is to a nonprofit as an IRA is to a senior citizen. People spend decades saving for a comfortable retirement. An endowment is your goose that lays golden eggs. It can ensure your nonprofit’s future by engaging your most loyal donors.
BUT! Endowments aren’t for everyone. If you’re an established nonprofit with earned revenue and a strong donor base, it can be the perfect wish list item. If you’re a start-up nonprofit without a database… not so much.
Your endowment secures your nonprofit’s future. Donors can fund it in the form of cash, appreciated stock, IRA rollovers, bequests, etc. (There are lots of ways to give to an endowment fund – check out my recent webinar for more examples!) The proceeds of these funds provide operating funds in perpetuity – a gift that gives year after year.
Want to find the donors who will make your endowment wishes come true? Here are two tips you can use NOW:
- Know who to ask
Look at your recent donations. Many donors have already made their year-end contributions. Most nonprofits receive the bulk of their individual donations in the last three days of the year, but some (often dedicated) donors plan further in advance. Touch base with them again before year-end and invite them to consider a planned gift.
2. Create urgency
Why the year-end push for planning an endowment? A federal estate tax exemption is slated to sunset soon, reducing benefits for folks with $5-11M in assets. If you have major donors who would benefit from this exemption, talk to them sooner rather than later. You’ll reap the benefits, too!
Endowment can’t be rushed, but if your nonprofit’s ready, start planning one now. It’s one more thing you’ll be able to check off your holiday list.
Want to learn more about endowments, how they work, and if you’re ready for one? Check out my recent webinar, generously hosted by the Foundation for Delaware County’s Center for Nonprofit Excellence.
If you find out that you’re not quite ready for an endowment, send me a message to see how I can help!
Written by Jorie Moss and Val Jones