MacKenzie Scott, ex-wife of Amazon founder Jeff Bezos, has been doing quite a bit of charitable giving lately that has garnered a significant amount of attention. According to the Chronicle of Philanthropy, Scott has donated a total of nearly $8.5 billion to 798 nonprofits this summer, including significant gifts to local charities such as Goodwill of East Texas and East Texas Food Bank. What makes her charitable giving unique, other that it’s sheer size, is the fact that the gifts are unrestricted. Often, gifts of this size to charities are designated for specific projects or programs and come as a result of weeks or months or years of planning and working with a donor. Scott’s unrestricted gifts remind me of several types of gifts that you may consider over your lifetime — annual gifts, campaign gifts and estate gifts.
Annual gifts are what most charities normally consider unrestricted gifts. Annual gifts are the key to sustainability and success for most nonprofits. Donors come in a wide variety of personalities and preferences, so most charities organize several opportunities throughout the year to attract critical annual support. The things that you like to do to show your support may be very different from the things your neighbor likes to do. Golf tournaments, galas, skeet shoots, luncheons and 5Ks are several types of events that are organized to allow you to enjoy an activity with friends, while lending your support to an important cause. In addition to hosting fundraising events, many nonprofits utilize standard tools such as mail, email or phone solicitations, or participate in online efforts such as East Texas Giving Day. As a donor, you likely have a routine that you have developed to support one or more charities, annually and regularly. Let me encourage you to continue your faithful support of your routine, because what you may take for granted as a part of your normal routine, provides critical annual support to sustain the important work of local charities.
From time to time you may also be asked to consider a gift to support a special campaign for a local charity. When a charity needs to expand a program, replace equipment or acquire a new building, they often launch a campaign to raise support for a very specific project.
Campaigns are initiated to support a focused objective and most of the support received to reach the campaign goal will come from existing, faithful donors. Campaigns require you to give more thought and attention to your gift and may require professional assistance and planning to identify a strategy that will work for you and the charity. Such planning may include the gift of an asset such as appreciated stock or real estate, or the use of a donor-advised fund to make grants to meet your goal over a period of several years. No matter which route you choose to make a campaign gift, it is important to avoid neglecting your annual support. Charities will often plan for a bit of a drop off in annual support during a campaign, but let me encourage you to plan better than the average donor, and keep up with your critical annual support as you help your favorite charities tackle significant projects.
Finally, as you provide consistent annual support for your favorite charities and step up each occasion to meet specific campaign goals, you may develop a strong connection to an organization. The last opportunity for you to support a favorite charity is with a meaningful gift from your estate. No one enjoys thinking about their own demise, but if you have spent a significant amount of your time, talents and treasure supporting a charity, planning for a gift from your estate can be a very natural and rewarding.
Here is a simple suggestion to help an organization continue their important work after you are gone. Consider a gift from your estate of twenty times your normal annual support. Such a gift might be very difficult or impossible to make from your annual income, but it makes much more sense and is not a significant burden for your estate. For example, if you support a charity with a gift of $1,000 each year, consider a gift of $20,000 from your estate. In order to make the gift sustainable, designate it for an endowment and, over the long term, the annual income will likely match the annual support you were providing during your lifetime.
Scott’s recent charitable giving has made headlines around the country, but most of us live in a world that requires more discipline and commitment to manage our limited resources and provide support for local charities. Annual gifts, campaign gifts and estate gifts are each a vital part of the trifecta of Giving Well.
Guest columnist, Kyle Penney is President of East Texas Communities Foundation. ETCF hosted East Texas Giving Day in April and raised over $2.8 million to support local nonprofits. To learn more about ETCF or to discuss your charitable giving, contact Kyle at 866-533-3823 or email questions or comments to firstname.lastname@example.org. More information is available at www.etcf.org.