For the really big gifts, ask for the residue.
It was the kind of gift we all dream about. Our organization received notification from an attorney that we were to be the recipient of a $100,000 bequest from a woman whose name we did not recognize.
We did a little research in our database and discovered this woman (let’s call her Doris) had been a loyal annual donor for $500. Digging back further, we found that she had done a relatively small gift annuity many years earlier. Doris passed away at age 94. Her husband had predeceased her, and she had no children.
When we received the check, we also received a list of the other distributions from Doris’s estate. The $100,000 gift to our organization was significantly more than gifts to any other designees. However, there was another charity named to receive whatever was left over in her estate—in this case, $8.2 million!
Please pass the leftovers.
As gift planners, we often neglect to ask for the residual. But, as Doris reminds us, we should! It’s an easy ask, it gives the donor a lot of flexibility, and it’s likely to be far more than any specific designation.
It’s an easy ask.
I say something like this: “After you’ve considered how much you’d like to leave each of your heirs, would you consider leaving us whatever might be left over?”
It gives the donor flexibility.
You’ve heard this objection to giving before, haven’t you? “I don’t know what expenses might come up. What if I get sick? Or my kids need help?” You can set your donor’s mind at ease by asking for a gift of “the leftovers.”
Many people who have substantial wealth don’t want to leave too much to their children. They may decide, for example, $1 million for each child is plenty. A residual gift to charity can be an easy way for a person like that to ensure their children won’t receive too much and the rest, whatever it may be, will go to a cause they care about.
I say something like this: “All we’re talking about is the what’s left. Spend everything you need during your life, take care of yourself and your loved ones. You don’t know what you’re going to need, so by all means, save! All I’m talking about is what’s left. Would you consider leaving that to us?”
It’s likely to be a bigger gift.
In some cases, the residual won’t be as big as a specific designation. But more often than not it will be significantly larger—like Doris’s leftover gift of $8.2 million!
Categories: Bequests, Estate Planning