I decided to name this blog after the story in Genesis 47 because it is instructive in a way that we don’t often consider, in our efforts to turn years of plenty into futures of plenty. Pharaoh was told to set aside 20% of the income from seven abundant years to use it, to spend it, over the next seven years — to meet human need, not to produce interest income as an additional revenue stream for the palace.
Most churches and most non-profits do a pretty good job (although we all can do better) at talking to their members and supporters about the importance of regularly supporting their annual operating budget with a recurring gift or pledge out of the member’s income. Churches have the extra advantage of a common language about giving back to God.
Very few churches or non-profits are anywhere near as systematic about talking to their supporters about ALSO supporting their mission with a significant one-time gift out of their estate. Many endowments that do exist came as unexpected surprises, or as the result of extensive targeted cultivation of a few significant prospects.
And yet if churches – or non-profits in general – succeeded in making their case for the second kind of gift at the same conversation rate that they do in making their case for the annual kind, they could transform themselves within a generation.
If every household in your church would endow their pledge – would commit to a gift out of their estate of $20,000 or so for every $1000 they pledge on an annual basis – then within 60 years, your endowment would be producing as much as your current annual appeal does; you could double the resources available to pursue your mission. And, probably two-thirds or more of your pledge revenue comes from people over age 50; so there is a chance that you could increase your budget by 70% in just a generation, even without increasing pledging.
Excited yet? No, me either. This is going to take too long, and the benefits are too far down the road.
But Pharaoh’s Dream offers one other bit of advice for making a case for that legacy gift. Joseph didn’t tell Pharaoh to store up seven years’ worth of surpluses to invest it at 8% so he could spin off 5% per year while reinvesting the other 3% as a hedge against inflation forever. The plan was to use it over the course of a seven-year famine.
Maybe we need to change, or at least add a new dimension to, the paradigm of how to use estate gifts. Maybe putting a million dollars into an “investment vehicle” that spins out $50,000 a year until the end of time isn’t the only or the best way to inspire giving or plan your organization’s long-term future. Perhaps other donors – particularly those whose estate gifts will be four or five figures instead of six or seven – can better visualize the meals served, the people clothed, the lives changed if their gifts, pooled with others like them, were spent down over a given number of years – perhaps a generation, during which time the next generation of donors are cultivated to replace the gifts that preceded them.
There are and have been charitable foundations, such as the Herman Krannert Trust and the Nina Mason Pulliam Charitable Trust, designed to self-liquidate in this manner. How many individual institutions are beginning to plan at least a part of their legacy giving and asset management programs in this way? Trinity Episcopal Church in Indianapolis is at least exploring it. In posts to come, I’ll share what we’ve experienced, and what I’ve found in talking to others across the country.
We may survive this famine yet. We may even come through stronger.