Planned giving for churches: How to build legacy & community

And do not forget to do good and to share with others, for with such sacrifices God is pleased.‍

‍Hebrews 13:16 NIV

For churches, planned giving represents a major opportunity to deepen your relationships with congregants and sustain your ministries for generations to come.

Historically, churches have been receiving estate gifts for centuries. Today, many churches already understand the value of this form of giving and take steps to provide members with friendly estate planning resources and reminders.

But for some churches, planned giving is a new undertaking, one that’s possibly (and understandably) out of their comfort zones. This form of fundraising is quite different from more typical tithes and pledging requests.

What is planned giving, and why is it a worthwhile priority for churches? How does it benefit your church members? And how can you get started?

This guide will review all of the essentials and lay out the context you need to make the right decisions for your own church. Here’s what we’ll cover:

• The basics of planned giving
• The “why” of planned giving
• The “how” of planned giving
• The 3 most important steps to take
• Planned giving resources to learn more

The basics of planned giving for churches

First, let’s review some context.

• What is planned giving? Planned giving, also called legacy giving, consists of any gifts that members make to your church through their financial or estate plans. They’re typically deferred, meaning the funds will not be disbursed until after the donor passes away. However, other types of planned gifts can be set up to benefit both your church and your donors during their lifetimes.

• What are common types of planned gifts? Bequests in wills are by far the most common type of planned gift because they’re easy to create and accessible to large groups of donors. Beneficiary designations on life insurance policies and unused retirement assets are also common. Other types of more complex gifts can be created to generate regular income payments for donors or to protect their assets. Learn more about the specifics of these gifts with our guide to the types of planned gifts.

• What kinds of organizations ask for planned gifts? A wide variety of 501(c) organizations, including churches, charities, and associations, ask their donors for planned gifts as part of their normal fundraising work. It’s important to note, however, that the exact tax implications for donors can vary greatly between different types of organizations, so it’s important to research IRS stipulations before speaking with donors.

• What does a church need to begin promoting planned gifts? For larger organizations, dedicated planned giving programs will be created to handle the fundraising and logistical work of managing these gifts. But you can also start small—for smaller organizations and churches, you’ll simply need a plan for speaking about these gifts, resources to provide your congregants, and a system for keeping track of your work. With an organized approach, you can easily grow your program over time.

The "why" behind planned giving for churches

What makes planned giving a worthwhile endeavor for churches? If you’re new to this form of fundraising, you probably have a few questions.

Why does planned giving matter for churches?

Planned giving can be a transformational way to help fund your church’s ministries, missions, and programs. Why?

First and foremost, legacy giving creates meaningful ways to engage and help your church members, enriching your relationships over time. It can provide:

• A new way for members to demonstrate their commitment to Christ and their church community
• An avenue for celebrating their families’ deep connections to your church through named endowments, buildings, and programs funded by their gifts
• Education and awareness-raising about the importance of estate planning for congregants of all ages
• Help with resolving the burdens of asset distribution decisions in estate plans

Legacy giving is also highly inclusive because these gifts are given from assets rather than cash on hand. While only a handful of your members might be able to give a large gift immediately, many more might be able and willing to give an equivalent gift through your legacy program.

And although donors can restrict them to fund only certain programs or ministries, most planned gifts are unrestricted, meaning your church can rely on them to help cover the essential operating costs of your daily work and growth.

These gifts can also be an invaluable way to protect your church’s future by stabilizing and diversifying its incoming revenue. For instance, a church’s oldest congregants also tend to be its most generous—if several of them were to pass away around the same time, you might be faced with new financial shortfalls right as you’re focused on mourning the loss of your community members. Establishing a steady stream of legacy gifts can prevent these challenges and help you responsibly manage risk.

Why would church members want to create planned gifts?

Your church members may want to create planned gifts for your church for several reasons. This is a highly personal way to give, so each individual’s exact motivations will vary, but they can usually be broken down into these primary reasons:

• To give back. You already work to instill a spirit of giving in your congregation, not just to your church but to other worthy causes in the community through giving campaigns and food drives. Legacy gifts are another way to give back to your church community that does good in people’s lives.
  
  
• To demonstrate commitment. Members might be looking for ways to deepen their commitments to Christ and to the community that you’ve created. Planned giving is a more accessible way to give larger or more impactful commitments than many members would otherwise be able to because it’s deferred and does not draw from daily cash flow.
  
  
• To improve end-of-life plans. Legacy giving opens opportunities and conversations that encourage church members to approach their end-of-life plans faithfully and productively. These gifts can be a final testament of faith, and estate planning can be an act of love for everyone in a church member’s life. By creating an avenue for having these discussions, planned giving helps members approach a difficult topic in more positive ways.
  
  
• To secure tax benefits. Planned gifts bring a range of potential tax benefits for members. This can be a powerful motivator for those concerned about the tax impact that their estates will have on their heirs since many planned gifts can reduce overall estate taxes. Just remember to do your research and avoid giving direct financial advice before discussing the tax implications of gifts.

What challenges prevent churches from asking for planned gifts?

Although many churches have historically relied on legacy giving as a way to generate support and deepen their relationships with members, many others have hesitated to do the same. This form of giving differs from traditional donation requests in many ways, and it’s a highly personal request to make of your members.

If your own church has avoided pursuing planned gifts in the past but wants to make it a priority, it’s important to understand the hurdles that have held you back so that you can properly address them.

First, planned giving brings up difficult topics, namely death and estate planning. Others might fear that asking for planned gifts will come off as too money-focused.

It’s important to remember that your church has likely been the setting for many of its members’ most important life events. Your ministry has roles to play in members’ lives, and they look to you for guidance and support. Not being afraid to discuss legacy giving helps them to accept their mortality and understand the importance of end-of-life plans—both logistically to ease any burdens on their loved ones and spiritually as an opportunity to create legacies and demonstrate their values with final acts of faith.

Planned giving is uniquely positioned as a way to give that has outsized benefits for your church, creates new opportunities for members to enrich their faith, and starts important conversations. Even if a member doesn’t create a legacy gift, you’ve helped them by providing education and resources about the necessity of estate planning.

Churches might also avoid discussing planned giving simply because it’s unfamiliar and seems complicated.

Although some types of planned gifts can be complex and require the help of legal and financial professionals, others don’t. Bequests are the most common form of legacy gift because they’re the simplest, requiring only that members make small updates to their wills, which can be done for free. By starting small and taking your time, you can build a thriving legacy giving program—we’ll explain how in the steps below.

There’s also a common fear that asking for planned gifts will reduce current giving or otherwise create a sense of donation fatigue among congregants.

These fears make sense, but they’re not entirely founded. Legacy giving is a different way to give than traditional offerings of cash, and so are the motivations that go into them and the implications and benefits that they bring to donors.

Successfully educating your congregation about the importance of estate planning and securing legacy gifts will serve to deepen your connections and commitments to one another. For many charities, annual giving from planned donors actually increases over time, averaging $3,000 more per year. By making it clear that planned giving is a special way to support your church and emphasizing the benefits it brings, you’ll differentiate it from your other fundraising efforts.

The bottom line is that legacy giving can be a natural extension of your stewardship efforts. It brings value to your members, your church, and your entire community in unique ways, and it’s much easier to begin exploring than your congregational leaders might assume.

Why is right now the best time to get started?

Don’t wait to begin building your church’s planned giving program. As we’ve seen, planned giving helps your congregants, community, and church. Plus, it’s easy to get started, so there’s no reason to wait.

Some of your church members might also currently be struggling with end-of-life decisions and estate planning. Your church has a role to play in helping them address these challenges in positive, faithful ways.

Additionally, planned giving represents an increasingly prominent opportunity for fundraising organizations as demographics shift in the United States. Big decisions are happening right now as aging generations (particularly the Baby Boomers) shift focus to their estate and financial plans—an estimated $68 trillion will be passed on to heirs, charities, and churches in the next several decades.

Legacy gifts can transform your church’s capacity for good and support your ministries and programs for years to come. Other charities around the country are actively asking for them, and with the important personal and spiritual roles that your church plays in members’ lives, you need to be a part of that conversation, too.

For where your treasure is, there your heart will be also.‍

‍Luke 12:34 NIV

The “how” of planned giving for churches

If you’ve decided to make planned giving a priority for your church, how do you get started? What are the various tasks and steps that you can expect to encounter along the way?

We’ve laid out a roadmap of the key stages of asking for and accepting planned gifts for your church for the first time:

Phase 1: Set up and plant your church planned giving program.

First, lay the foundation for your planned giving program. Discuss the value of making it a priority with your church’s leadership team and provide educational resources like this guide. Talk about it as a group, answer questions, and align on your intent to move forward. Designate an individual to serve as the head of your planned giving program.

Set up the materials you’ll need to begin actively planting your new giving program and estate planning ministry. These include:

• A free will creation tool for church members, like the one offered by FreeWill
• Estate planning resources to educate interested members and discuss together
• Printed materials about your legacy giving program
• An expansion of the donation portion of your website to mention planned giving (or for more comprehensive coverage, a planned giving website that houses all of your tools and resources)

You’ll also need to consider how your church will accept and keep track of planned gifts. There are many ways you might approach this process, but the key is organization— you’ll need to be able to track your program’s success and effectively thank and steward your planned donors for their special commitments. FreeWill offers a complete planned giving platform that can greatly simplify your management tasks, giving you more time to talk with members instead of worrying about logistics.

Phase 2: Ask your church members about their interest in planned giving.

Next, you need an understanding of the current state of your congregation’s interest in planned giving. There’s a good chance that some of your members have already created planned gifts for your church or other charities that they support.

The easiest way to gain initial insights is to simply ask. Try sending a basic survey or attaching an extra inquiry to your next pledge or annual giving cards. Here’s an example:

Template Survey for Church Planned Giving Programs

Name: ____________
Address:  ____________
Email: ____________
Phone:  ____________

___ I/we have made a gift to [Church Name] through our estate plans.
___ Will or Trust ___ Designated Beneficiary of Account ___ Other

___ I/we have made a gift to another nonprofit organization through our estate plans.
___ Will or Trust ___ Designated Beneficiary of Account ___ Other

___ I/we would like information about ways to make a planned gift from my/our estate.

___ I/we would like information about ways to make a gift from a traditional IRA as a QCD.

___ I/we would like information about ways to make a gift from appreciated securities.

There are a number of valuable benefits of starting your planned giving efforts with a quick survey:

• You’ll get an immediate understanding of who’s already created a legacy gift for your church, enabling you to reach out and directly thank them.
• You’ll learn about your members’ current knowledge of these gifts, as well as who’s interested in learning more.
• You create the opportunity to promote other forms of non-cash giving like QCDs and gifts of stock (which are commonly solicited as part of planned giving programs).
• You can also gather initial testimonials and endorsements to help you further promote planned gifts to the congregation, providing valuable social proof, a demonstration that others already trust and enjoy giving in this way.

As you begin receiving responses, be sure to record them in an organized way. This information will serve as the basis for your ongoing planned giving efforts, so take care to start on the right foot.

Phase 3: Learn to talk about your church’s planned giving program.

As you get your program up and running, make sure to discuss messaging with your congregational leaders who will be involved in planned giving conversations.

There are several best practices to master and adapt to your unique community. Some of the most important of these include:

• Emphasize the benefits of planned giving for members—deepening their ties to your church, creating a lasting family legacy, demonstrating commitment to the congregation and to Christ, tapping into helpful tax benefits, and more.
• Explain the long-term impact that legacy gifts have on your church as sources of sustainable revenue that help you keep operating and growing for years to come.
• Avoid jargon, especially if your members aren’t familiar with more intricate estate or financial planning concepts.

We’ve written a comprehensive guide that your church leaders may find helpful—How to talk to donors about planned giving: 10 tips.

While there may be a bit of a learning curve if you’re new to legacy giving, your church does have an advantage—the depth and nature of the relationships between members and your ministry. Your connections will make it easier to speak about these gifts on a human level. Adapt the best practices to the unique human circumstances of every member who’s interested in planned giving so that you can serve and counsel them in the best possible way.

For example, while one general best practice is to avoid discussing death, there may be cases where it is appropriate for a church member and their clergy to frankly discuss end-of-life planning. Your judgment and God’s guidance have helped you to grow and shepherd your community this far—keep using them to help your members and your church in new ways.

Phase 4: Ensure a smooth, positive giving experience for congregants.

The experience of creating a planned gift for your church should be a smooth, positive one. There are several ways you can help ensure this:

• Understand the limitations of the traditional planned giving process. The way that people and organizations have historically handled bequest gifts can result in a less positive process for both parties. Unless donors actively notify organizations about their gifts, the organization has no way of knowing about it until it’s disbursed from the donor’s estate, meaning years of missed opportunities to express gratitude and deepen the relationship. Using the right tools to manage your program and help donors create bequests will prevent this gap and create a smoother experience.

• Provide resources and guidance. Seek to educate your church members about the importance of estate planning and their options for using their estate plans as tools for Christ and their community. Just be sure to not give explicit advice. Work with legal and financial professionals (who may already be among your congregation and willing to help) to answer members’ questions.

• Give your planned giving program an online presence. Today, the norm is to look first to the internet to learn more and get our questions answered. Make sure your church’s planned giving efforts are represented on your church’s website, either as a section of your Ways to Give page or as a dedicated microsite that houses all of your planned and non-cash giving resources. Put your program’s contact information front and center so that members can always directly reach out to ask questions or start conversations.

• Create a legacy society and provide social proof. Many organizations create special memberships called legacy societies for their legacy donors as a way to provide extra gratitude and perks. Consider establishing one for your church and planning special opportunities and outings for these members. Collect feedback, endorsements, and stories from them to use when promoting your planned giving program and to show them how much their experience matters to your church.

Phase 5: Learn more and improve your planned giving program.

Now it’s time to put your plans into action. Using your messaging prep and insights gathered from your survey, begin mentioning legacy gifts to your congregation and following up with members who express interest. Talk about their reasons for giving together. Walk them through how to use your online tools and resources to set up a bequest gift.

As you complete this process with more members over time, you’ll begin to learn more about what draws your church members to legacy giving. Use these insights to better explain and discuss your program going forward.

On the data side of things, make sure that the management system you set up in Phase 1 is still working well. Regularly review your planned giving data to see the performance of your efforts so far and to keep your data organized. Using tools like FreeWill can help with this process by generating easy-to-use reports and printouts for your program.

But don’t stop there—keep learning. As we’ve seen, a lot goes into running an effective planned giving program. There’s always more to learn about best practices and trends that you can adapt to your church’s own unique needs and community. For example, we recently hosted a comprehensive webinar just for churches looking for ways to encourage estate planning among their congregations:

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Resources like online guides, training sessions, and webinars aren’t just helpful for you. They also give you valuable insights that you can pass along to your church family of members.

As a responsible shepherd of your flock, you’re already off to a great start by exploring the potential of planned giving for strengthening your church, deepening your ties with members, and ensuring you can continue doing God’s work for years to come—now keep it up!

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Therefore everyone who hears these words of mine and puts them into practice is like a wise man who built his house on the rock. ‍The rain came down, the streams rose, and the winds blew and beat against that house; yet it did not fall, because it had its foundation on the rock.‍

Matthew 7:24-25 NIV

The 3 most important first steps for church planned giving

So you’re ready to get started discussing and encouraging planned gifts from your congregation. What are the immediate next steps you should take? These are the three most important (and easiest) tasks to add to your to-do list:

1. Ask your congregation about planned giving.

Start simple to gain an immediate understanding of your community’s familiarity with and interest in planned giving.

Key Action Items

• Identify those who have already created planned gifts for your church—your lead pastor or record keeper may already have this information saved in a database. There’s a chance that members may have created planned gifts for your church without notifying you, as well, so it will still be important to send a broader questionnaire.
• Send a quick survey or add an extra series of questions to your next pledge or annual giving card. See the template survey above for an example to adapt for your own church. Ask 1) whether members have already created planned gifts for your church, and 2) if they’re interested in learning more.
• Collect and organize your responses. Immediately reach out to your existing legacy donors to express your thanks, then create a list of potential donors who expressed interest so that you can begin reaching out to them.

2. Designate a leader for your planned giving program.

It will be difficult to push your legacy gift goals forward and inspire members to reflect on them without a concerted effort headed by an enthusiastic leader.

Key Action Items

• Recruit a staff member or volunteer to help lead your program and raise awareness of planned giving among the congregation. Note that this person does not need to be wealthy, financially sophisticated, or a planned giving expert—they just need to be excited about the benefits that legacy gifts can bring to churches and their members.
• Equip them with knowledge and tools. Encourage your legacy leader to learn more about planned giving with reputable online resources. Ask them to begin identifying the tools you’ll need and the platforms that might help, like FreeWill’s free bequest creation tool and complete planned giving platform.

3. Investigate how to incorporate planned giving into your website.

To make planned giving an effective long-term practice for your church, it needs to be incorporated into the central resources and places that the community looks to for information—starting with your website.

Key Action Items

• Add information about planned giving to your website’s “Donate” or “Give a Gift” page. If your church uses FreeWill to help facilitate bequest creation, directly link to the tool to make the step as easy as possible for members.
• Consider creating a standalone web page or set of web pages to more thoroughly explain your planned giving program, why these gifts matter, and how they work. These planned giving websites can become the go-to resource that anchors your program.
• Reach out to any software vendors to ask about their recommendations for promoting your planned giving program and making the most of the information that it generates over time. For example, FreeWill can offer customized planned giving web content and printouts to help support your program.

With these essentials in place—a foundational understanding of your community’s interest, a leader to oversee the program, and helpful, easily accessible tools—you’ll have everything you need to get started.

Begin reaching out to potential legacy donors to discuss this way of giving and its benefits. Add planned giving to your bulletin board and next newsletter. Ask any existing planned gift donors if you can use their endorsement to help spread the word. Get up to speed on your new planned giving tools, and ensure that you have an organized way to keep track of your program going forward.

Remember the mustard seed—with faith and care, you can start small and grow a thriving program that will support your church and empower you to do more of God’s good work.

Planned giving for churches resource library

As we’ve seen, planned giving is a uniquely impactful and meaningful way to raise support for your church. It can sustain your operations and ministries for years to come, all while deepening your relationships with members and creating new opportunities to commit to one another and to Christ.

Planned giving is worth prioritizing, not least of all because other organizations like secular charities have also taken note of its potential and are actively asking their donors (and your church members) for planned gifts.

After all, your church plays an important role in your members’ lives. Your church community is likely among the first places that many members look to build their legacies, but you have to ask them and let them know that it’s a possibility.

Learning more will be key to long-term success, so don’t stop here. Use these resources to continue educating your team and community about the value of planned giving:

• Planned giving: A complete guide to legacy giving programs
• How to start a planned giving program: Step-by-step guide
• How to talk to donors about planned giving: 10 tips
• How to find planned giving prospects: 4 steps
• Planned giving marketing: 7 strategies and ideas you need
• QCDs: 4 marketing tips to get more IRA Charitable Rollover gifts this year