Planned Giving

Quick answer: Planned giving is a donor’s gift arranged now that benefits your organization later—often through bequests, beneficiary designations, trusts, or life-income gifts. It builds long-term financial resilience and deepens legacy relationships with supporters.

What is planned giving? Planned giving refers to charitable gifts that donors arrange during their lifetime to be transferred to a nonprofit at a future date or that provide income back to the donor first (for example, bequests, beneficiary designations on retirement accounts, charitable remainder trusts, and charitable gift annuities). Development staff and executive leaders use planned giving to secure legacy commitments, diversify revenue beyond annual gifts, and strengthen multi-generational stewardship. These gifts often require legal or financial documentation, thoughtful donor conversations, and multi-year cultivation; they also tend to be larger than typical annual gifts but take longer to realize.

Why planned giving matters for nonprofits

As a development director, planned giving gives you a way to capture major future support without relying solely on year-to-year fundraising. Planned gifts can fund endowments, specific programs, or capital projects, and they create powerful stories that inspire other donors. The challenge is that planned giving moves slowly and depends on accurate records, clear stewardship, and sometimes legal or estate counsel. That means if you don’t track intentions, communicate with families, and steward commitments, you can miss transformative future support. With steady cultivation and a legacy program, you turn long-term promises into reliable future resources and deeper relationships.

How planned giving works in practice

Imagine Riverbend Community Center, a midsize nonprofit with 1,200 active donors. Maya, the development director, asks her major-gift officers to identify 30 donors who have given major gifts and expressed long-term support. Steps she follows:

1. Identify prospects: review giving history, notes from face-to-face visits, and volunteer leadership for affinity and capacity.
2. Have the conversation: conduct confidential legacy conversations that focus on values, options (bequest, beneficiary designation, gift annuity), and family considerations.
3. Record intentions: capture a signed letter of intent or estate language and log the commitment, restrictions, and family contacts in your CRM.
4. Steward: send tailored acknowledgements, include legacy donors in events, and maintain discreet family communications.
5. Monitor the pipeline: use segmentation and reports to prioritize cultivation and spot inactive stewarding needs.

By documenting commitments and automating stewardship steps, Maya keeps momentum on long timelines and honors donor intent when gifts mature.

Planned giving: key metrics and benchmarks

• Known legacy prospects (count)

• What to track: donors with documented estate intentions, letters of intent, or who’ve been invited into legacy conversations.

• What to watch for: growth in this list signals pipeline development; steady attrition suggests stewardship gaps.

• Pipeline potential (estimated future value)

• What to track: sum of documented commitments and conservative estimates for unnamed intentions.

• What to watch for: consistency in updates and conservative valuation methods to avoid overestimating future revenue.

• Conversion rate (prospect → realized planned gift)

• What to track: number of prospects with documented intention vs. realized bequests or transfers over time.

• What to watch for: planned giving often converts slowly; compare multi-year cohorts rather than single years.

• Average time from commitment to realization

• What to track: median years between documentation (letter of intent, beneficiary designation) and actual receipt.

• What to watch for: long timelines are normal—plan stewardship and reporting accordingly.

• Share of total revenue from planned giving

• What to track: realized planned gifts as a percentage of annual revenue for trend analysis.

• What to watch for: fluctuations are typical—use multi-year averages for budgeting.

Frequently asked questions

What counts as a planned gift?

A planned gift is any donation arranged now to benefit the nonprofit later or that pays income to the donor first. Common forms include bequests, beneficiary designations on retirement accounts or life insurance, charitable remainder trusts, and gift annuities.

How does a nonprofit start a planned giving program?

Start by auditing your donor data to identify potential legacy prospects, training staff and volunteers to have legacy conversations, creating simple documentation processes (letters of intent), and recording commitments in your CRM for long-term stewardship.

What’s the difference between a bequest and a charitable remainder trust?

A bequest is a gift specified in a donor’s will that transfers assets after death. A charitable remainder trust pays the donor (or beneficiaries) income during their lifetime or a term, then transfers the remainder to the charity—offering tax and income benefits during life.

When should I ask a donor about planned giving?

Ask when you have a mature, trust-based relationship—often after multiple meaningful interactions like major gifts, volunteer leadership, or multi-year giving. Make the conversation donor-centered and confidential; focus on values and legacy, not pressure.

How do you steward planned giving commitments over many years?

Record intentions clearly, schedule periodic check-ins, include legacy donors in appropriate events, and send tailored communications to families. Use your CRM to automate reminders for updates and to track any changes in donor circumstances.

How does planned giving affect annual fundraising strategy?

Planned giving complements annual fundraising by creating long-term financial stability. It doesn’t replace annual appeals but adds another revenue layer—so align messaging and stewardship across both short- and long-term donor journeys.

The bottom line Planned giving is a way donors arrange future or life-income gifts that create lasting support for your mission. It matters because it secures future resources and deepens legacy relationships, but it requires careful tracking and long-term stewardship. Start by documenting intentions in your CRM and prioritizing a small cohort of legacy prospects to cultivate over time.