Want to capture donations from billionaires and other High Net Worth Donors? Be ready with thoughtful answers to these 6 key questions.
High Net Worth Donor Motivations
As a nonprofit, we’re sure High Net Worth Donors are a priority for you. The question is: how do you engage them as effectively as possible? This all starts with familiarizing yourself with the needs of your donors. Today’s High Net Worth Donors focus on giving with purpose. They want to be philanthropic in ways that are impactful, actionable, and informed. But, what are the wealthy looking for when they give before deciding where and how to contribute major gifts?
James Lintott, the co-founder of the Sterling Foundation, consults and speaks with wealthy families, estate planning attorneys, and wealth advisors around the nation. He works with all of them to manage the philanthropic goals of high net worth families. Let’s explore the 6 key questions he believes High Net Worth Donors will ask before giving you their money:
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1. Do I Have A Chance to Make a Difference?
When deciding whether or not to give to an organization, High Net Worth Donors (HNWD) are less concerned about tex benefits, ego enhancement or short-term immortality. In short: major gift donors aren’t giving for selfish reasons. They aren’t giving to preserve their legacy and enhance their worth through philanthropic contributions. If anything, they are more concerned about the ways in which their donations will transform into action.
They don’t know where the line between ‘good intentions’ and ‘actual results’ lies, and they rely on their nonprofit to ensure that their contributions will be used to make a difference. And, even when a donor doesn’t know exactly what area they want to invest in, they know they have a burning desire to do good.
So, the primary question you have to answer when your donor comes to you is: what won’t happen if you won’t get this money? By posing this question, your donors will consider what they’re pouring their money into and what their motivation behind giving is. In short: is this something they have a vested interest in? And will they regret not giving to this cause?
2. Am I Afforded Expert Help?
High Net Worth Donors seek out experts for almost everything. So, it’s incredibly important that your donors feel that they are making informed decisions with their money. Essentially, your donors want to know that they can trust your expertise. Donors may have questions such as: why should I contribute to your organization? How? And, what’s the best tax vehicle through which I can give?
If they have any questions regarding tax implications or specific questions about your cause, you need to provide them with the necessary resources. This could be done through your organization itself or by connecting them with external resources and people that would be even more beneficial. Show them where you are getting that talent who’s done this before or the ways in which you are educating yourself in this endeavor.
3. Will My Gift Yield Measurable Results?
High Net Worth Donors are more inclined to give once they have a greater understanding of where their money is going. They want their major gifts to transform into actionable change. So, these types of measurable results help generate long term relationships with donors.
If they are given evidence that their contributions will result in positive, lasting change, they will want to contribute in the future. Not only are their intentions valued, but they are acted upon by the causes they want to see flourish. So, not only will your cause be able to secure gifts now, but they will in the future as well by showing clients measurable results.
4. Do I Have Flexibility?
Your High Net Worth Donors aren’t concerned with digging into the intricacies of your organization. Their primary focus is to make a difference. So it’s important to consider what resources your donor may need to realize their goals. This requires you to think outside of your organization. What partners can you include for them to realize their goals? What investments do you need to make?
Instead of getting trapped in standard practices, it’s important to consider what can do to help your donors achieve their goals. Think: what can we do to get the difference? What will solve the problem? The more flexible you are in the planning stage and in your ability to provide resources, the more likely High Net Worth Individuals are to donate.
5. Is There A Way to Involve My Family?
For many High Net Worth Donors, giving is not an individual venture. It involves every member of their immediate family, especially their children. By doing this, HNWDs are collectively encouraging, nurturing, and involving the next generation in giving.
They want them to enhance their skill set to review grants and build their decision-making skills. Especially if their children are to manage the family foundation later on, it’s crucial that they have a space to develop their passion for philanthropy. If your cause is able to afford these opportunities. to younger generations, HNWDs are likely to take an interest because their children can extend their efforts, and invest in their own projects.
6. Is My Gift Tax Deductible?
Many High Net Worth Donors consider their gift tax to be the last good deduction left. Charitable deductions, in a sense, help them see the path towards lasting change. Although High Net Worth Donors are more interested in making a difference with their contributions, it’s still necessary to outline the benefits they will receive.
By letting donors know if their gift entitles them to a charitable contribution deduction against their income, you’re providing them an additional incentive to give. Not only are they acting altruistically, but they’re also able to receive tax relief.
Catch a Recap of Serving Today’s High Net Worth Donor
Interested in learning more about the best ways to engage your benefactors? Watch James Lintott’s talk on how to serve today’s high net worth donors, presented at the WE Prosper Summit 2019.