Over the past weeks we have been exploring the three essential ingredients for strengthening your congregational finances, LEADERSHIP, RELATIONSHIPS, and AN ASKING STRATEGY. There are four primary asking strategies to consider: Annual giving, Capital giving, Endowment giving, and Earned Income. This week we focus on the third one… Endowment Giving. Endowment funds remain an important piece of a long-range planning process for every church and non-profit, but because they tend to do their work “behind the scenes” endowment funds and the purposes for which they are created can often be forgotten or misunderstood.
Every person who displays a generous heart as a part of their make-up at one time or another gives thought to their own legacy. Let’s be clear, endowments are not just for the wealthy. Many long-time members or supporters of modest means can still be great candidates to target gifts from their estate plans to your endowment fund.
If you already have an endowment fund established, or if you are considering establishing an endowment, there are several key things to consider:
- Consider having two funds: one as a “pass through” fund to support immediate ministry projects; the other as a true endowment where only a portion of the earnings are distributed and the principal balance is kept intact.
- You can have a separate team that invests the funds, but it is best to keep decisions about fund distributions in the hands of the church governing body. Clear, documented policies on how the funds will be distributed need to be communicated to the congregation and all potential donors.
- An ongoing education process is important. Develop a simple piece of literature to promote the fund, and share through email, Facebook, website, etc. Conduct planned-giving seminars with your members… and as you do, don’t be bashful to ask for consideration of a bequest gift to the congregation’s endowment fund.
- When dollars from an endowment fund are spent, celebrate the occasion. Celebrate the foresight of the donors who helped create the fund. Celebrate the project or program that benefited from the funds. Explain how these dollars are above and beyond your operating budget. Too often endowment fund dollars are spent quietly and the congregation knows little about the impact of the fund.
- Establish a Legacy Society for all members (past and present) who have remembered the congregation in their will.
- Hire professionals to help. They can advise your members on the various options available for making a planned gift (life insurance, real estate, stocks/securities, charitable remainder trusts, etc.).
Next week we will explore the 4th asking strategy… Earned Income.
(This current series of articles is taken in part from the book “Raising Money For Your Congregation”, written by Bob Connolly of The James Company, published by ACTA Publications https://actapublications.com/raising-money-for-your-congregation/)
Fred Stoltz, Sr. Program Director
The James Company