Older donors: 5 key trends on major gifts & what to do next

As a major gift officer, you know that Baby Boomers (57 to 75 years of age) and the Silent generation (76 to 93 years of age) are the most charitable generations, making up 41% of all donations. They’re also where the wealth is — Boomers in particular make up 55% of all high net worth donors.

However, in recent years, their giving behaviors and preferences are changing rapidly. To optimize your major gift fundraising strategy, it’s important to get up to speed on these changes.

Here are the top five charitable giving trends you should know about and what to do next:

Trend 1: Older donors are using technology more and more.

At the beginning of 2020, before the pandemic hit, 73% of Americans 65 and older were already regular internet users. They spent more than 27 hours per week online, two more hours than those aged 16 to 34. The pandemic only accelerated this trend, forcing older demographics to get online more often to connect with their friends and family. Knowing this, it’s not surprising that Boomers are the fastest growing demographic of Facebook users.

78% of Boomers and 33% of the Silent generation regularly use the social platform. And Boomers are 19% more likely to share content on their feed compared to any other generation.

What to do about it: Use Facebook to connect and engage with major gift prospects.

As a major gift fundraiser, Facebook is the best social platform for identifying and engaging prospects. Older generations mainly use Facebook for connection and research, so you’ll want to make your content engaging and informative. And you don’t need a huge marketing budget to be effective.

Here are three simple strategies you can implement on your page today:

1. Boost your organic Facebook posts. This is a powerful way to turn your organic posts into ads and reach an audience that goes further than the supporters that already follow you. To "boost" a Facebook post, you choose a post on your page, select "boost post," and fill in the details for your ad. This includes the budget you want to spend on it, who you want to see it (audience), and how long you want your ad to run (duration). And you can target your audience based on several major gift markers, such as location, income, age, and net worth.2.

‍Create Lead Ads to identify donors who want to learn more about different giving vehicles. You’re probably not going to secure a major gift from social media, but you can identify who is a good prospect by finding out who wants to learn more about their options. Lead ads make prospect identification easy. They pair an image with a short, descriptive paragraph to get people to click on a call to action. When they tap on your ad, a form pops up — it’s pre-populated with their Facebook contact information and ready to be sent directly to you, making it easy to collect prospect info. Plus, you can set your own budget, based on how many people you want your ad to reach. By creating ads that emphasize the benefits of QCDs, DAFs, or stock gifts, you can start building your prospect email list.

Pro tip: Make sure to implement social proof into your CTAs. Social proof is the concept that people want to behave in ways similar to their peers — and it’s extremely effective. Instead of using something generic like “Learn More,” use language that implies others have followed suit. For example, you could say “Join other donors like you.”

3. When engaging with potential major gift donors, use video. On Facebook, this form of outreach averages eight billion views a day. The key is to keep your videos short — those that receive the most interaction are between 60 and 90 seconds long.

Start by filming a clip on your phone of a staff member outlining your mission, or educating donors on how they can make an impact. Or, highlight a donor story to connect on an emotional level, build social proof, and drive traffic to your donation page. Make sure that you or someone on your team is ready to quickly connect or message those who engage with your content.

Trend 2: Average net worth for older donors has doubled in the past decade.

When fundraising major gifts, you know that high net worth individuals are your top prospects. The latest data from 2019 shows that those aged 52 to 70 have seen a huge increase in their average net worth, rising from $750,000 to $1.2 million.

Why? Investments have gone up significantly in value. And older generations have seen huge gains in home equity — the difference between the current value of a home and its mortgage. Homeowners aged 66 to 74 saw a median gain of $100,000 last year. Plus, personal cash savings are at an all-time high due to reduced spending during the pandemic.

One big indicator that your older donor’s investments are doing well is the S&P 500, which has doubled in value since 2016 and is a good gauge of overall stock market performance. This means that if your older supporters own stock or other assets, they’ve probably seen more growth than expected.

What to do about it: Educate donors on the benefits of major gifts of stock.

Stock gifts are key to major gift fundraising — organizations who focus on them grow six times faster than those who don’t. But many of your older donors either don’t know how to give stock or don’t know it’s an option.

Donor education and awareness is critical to bringing in major gifts of stock to your organization. Start by:

1. Creating a stock donation webpage, and linking to it on your donation page and in fundraising outreach. On this page, include the benefits of stock gifts, and instructions on how to make a gift to your organization. You should also include a form to collect donor information so you can steward these gifts properly. Many brokerages won’t provide it when they transfer a gift.

This webpage from Reasons to Believe allows donors to choose when and how they’d like to donate stock. (For transparency, this page is their custom FreeWill Stock Tool landing page. But any place where the donor could give online or learn more would work.)

2. Mentioning tax savings in all written communications with your major gift prospects. In a study done by charitable giving expert Russell James, he found that mentioning tax deductions increased charitable giving by almost 20%. Let donors know that they can avoid paying capital gains taxes, and take a charitable deduction for the current value of their shares when making a stock gift. This can result in tax savings of up to 70%, making their gift more valuable at no added cost to them.

For examples of how to do this effectively, download our stock donor email templates.

Trend 3: The amount of older donors giving QCDs has tripled since 2017.

Qualified Charitable Distributions (a.k.a. “IRA Charitable Rollovers, a.k.a. “QCDs”) is one of the fastest growing forms of philanthropy, and the single best way for your older donors to give major gifts.

Anyone over 70.5 can make these tax-free gifts out of a traditional IRA. They reduce a donor’s taxable income, while helping them to meet their Required Minimum Distributions (required annual withdrawals for IRA-owners over 72). With more than $7 trillion in IRA accounts, QCDs present a huge major gift fundraising opportunity for your organization.

What to do about it: Go big on QCD marketing and donor education.

If you want to bring in more QCDs this year, you’ll need to reach out to your prospects more than once. Of the nonprofits we surveyed for our 2021 QCD Report, 86% received gifts after marketing QCDs just two times last year. They also received 39% more gifts on average. And nonprofits who said their organization marketed QCDs four or more times received more than 25 gifts on average.

However, before sending any outreach, you’ll need to:

1. Get up to speed on the process for different custodians (like Fidelity, Schwab, and Vanguard) so you can guide donors and answer questions.
   
   
2. Create a separate page on your website with information on how to make IRA gifts to your organization. On this page, you’ll want to include:

• Easy-to-understand information about what QCDs and RMDs are
• An outline of the tax benefits for giving QCDs vs cash
• Step-by-step instructions for making a QCD
• FAQs about recent legislation or more complex aspects of QCDs (you can find this information in our 2021 QCD Report)

Here’s a great example of a QCD page from the American Red Cross:

When a potential donor clicks “Get Started”, they’re taken to another page with instructions for making a QCD.

Once you’ve completed those steps, you’re ready to reach out to prospects. If it’s tough to squeeze QCD marketing in an already packed fundraising calendar, you could try including it in your existing outreach.

For example, you could list QCDs as one of several ways to give for those over 70, or include a postscript in a broad fundraising email, like in this example from Second Harvest:

Don’t forget to link to your QCD info page. You can even track who clicks on this link and mark them as QCD prospects.

Need help getting more QCDs? Learn more about the FreeWill QCD Tool.

Trend 4: Grants from Donor Advised Funds are reaching record highs.

Donor Advised Funds (DAFs) are quickly becoming the most active giving vehicle for donors over 50. And DAFs hold a lot of wealth. In 2020, the number of grants made from DAFs to qualifying nonprofits rose to a record $27 billion. It's projected that the number of grants made from DAFs to nonprofits in 2021 will reach $31 to $40 billion, and the value of assets in these accounts will grow to $150 to $200 billion.

If you’re not familiar with DAFs, they allow donors to make a charitable contribution at a sponsoring organization and receive an immediate tax deduction. Donors recommend grants from the fund over time to a qualifying nonprofit. To open a fund, a donor typically has to contribute between $5,000 and $25,000, making them a popular option for wealthy donors, and a great opportunity for major gift fundraisers.  

Since grants from DAFs don’t require as much paperwork as other types of non-cash assets, they’re easy for donors to give and turn into recurring major gifts. If you or your team can get better at finding and cultivating DAF donors now, you’ll have a significant impact on the future growth of your organization.

What to do about it: Incorporate DAFs into your donation page and in every major donor conversation.

As DAFs become more mainstream, you need to remind donors about this major gift option when they’re ready to make a donation.

You can do this in two ways:

1. Include a link that says “Give from My Donor Advised Fund” on your primary donation page. By putting this link on a page where donors are already preparing to give, you can get even larger gifts from those who may not realize your organization accepts DAFs. This link should then take them to a separate page with information on how to give a DAF to your organization.

Below is another great example from the American Red Cross website. Their DAF page includes more information about what DAFs are, and how to give them by mail or online.

2. Ask every major gift prospect if they have a DAF. In any one-on-one conversation you have with a prospective major donor, you’ll want to bring up DAFs. And use social proof, which is the idea that donors want to behave in ways similar to their peers. For example, you can say: “Many of our supporters give out of a Donor Advised Fund. Would you like information on how other donors are using their DAFs to make a big impact?”  

Trend 5: Older donors are thinking about estate planning more than ever.

This trend doesn’t technically fall under major gifts — however, bequests, or gifts made in a will, are going to be some of the largest gifts your organization will ever receive from your older donors.

Though people aged 65 to 84 account for just 15% of the adult population, they make up 32% of all bequest dollars committed to charity. And the average bequest value for donors over 60 using our tool is almost $70,000.

Why is this the case? The large and wealthy Baby Boomer generation is set to pass on an estimated $68 trillion as they age — and that money is being allocated right now. Despite a tough year, 63% of organizations have seen planned gift donors raise their gift amounts during the pandemic.

What to do about it: Send targeted outreach emails to your older donors.

Though it can be tough to incorporate planned giving marketing into a packed communications calendar, we’ve found that standalone emails are more than twice as successful at generating legacy gifts than emails with multiple options to give.

But you don’t have to write them from scratch — we’ve created email templates with effective planned giving messaging to save time and get you or your team started.

It’s important to remember that when fundraising planned gifts, you have to be thoughtful and effective. Highlight the range of ages making planned gifts so your older donors feel less targeted and part of a broader audience. And use email instead of direct mail — even older generations are more likely to respond that way.

For example, you can say: “Supporters of our humane society, from 18 to 88, choose to include us in their will or trust. Would you like information on how to join them?”

‍
With clear steps on what to do next, you can begin fundraising major gifts from your older supporters this year and beyond. For more insights and strategies, watch our webinar on older donors from earlier in 2021.