What are endowments and planned giving arrangements? ___An endowment is a fund built up from donations, of which the principal is invested, and the income used for the support of the organization or institution. ___A planned giving arrangement is one in which a donor contributes to an organization or institution, and receives both tax advantages and an income from his donation for a fixed period or his lifetime. ___Planned giving arrangements include: Charitable gift annuities. Charitable remainder trusts Pooled income funds Life insurance Why would you want to secure endowments or planned giving arrangements? ___They’re attractive to donors. ___They’re more likely to get you large donations. ___You can use the good experiences of donors to attract other donors. ___They give you investment opportunities, and the chance to develop a funding base that will continue to grow. ___They can make possible programs or opportunities that you wouldn’t otherwise be able to fund. ___They can give you the long-term financial security that makes long-range planning more than hope. ___They can free you from the restrictions of public and foundation funding. When should you try to secure endowments or planned giving arrangements? ___When you’ve grown to the point that you have, or can buy, the capacity to invest and administer the funds you want to set up. ___When you have a base of donors and potential donors that can make it worthwhile to set up endowments and planned giving arrangements. ___When you have the capacity – either through volunteers or a development office – to market your program to potential donors. ___When the reputation of your organization or institution is one that will make donors feel that their money is both well spent and well used. ___When your organization has a need for something that requires a large capital investment. ___When funding restrictions from public or private funders make it difficult or impossible to do work that is in the best interests of the community or the society. ___When funding from public and private funders becomes scarce. How do you secure endowments and planned giving arrangements? __ Determine whether the arrangement you’re considering is possible for your organization in your community. __ Set up your financial arrangements. __ Reach out to and recruit potential donors. __ Implement your plan: Monitor and maintain your systems. Cultivate current donors. Continue to recruit new donors. __ Keep at it indefinitely.
