Tocqueville Sustainer a new fundraising strategy for retirees 2016 Retaining Donors in their Retirement Years and Stemming Donor Loss

Six Pilot Cities designed this strategy with UWW Major Donor staff from June to December 2015 United Way of Central Carolinas ( Laurie Foster Nortz ) United Way of Central Iowa (Melanie Campbell) United Way of Central Maryland (Jeff Pratt) United Way of Greater Toledo ( Gordon MacRitchie ) United Way of Northeast Florida ( Sharon Clark) United Way of Southeastern Michigan ( Denise Fleckenstein) The Tocqueville Sustainer concept was also presented to the UW Retirees Association Board who positively endorse and support this new strategy. 2

Our loyal retiring donors United Way has faced a significant decline in our donor base, from 12.2M in 2006 to 8.7M in 2014 One of the big challenges facing our long-term relationship building with Tocqueville members is our current response to their retirement. The long-term, passionate, loyal partner who has given $10k annually, now faced with lower income, lowers or cuts their gift (with good reason) to United Way. United Way responds by dropping the donor from all relationship building and engagements effectively telling the donor 1) we only care about the gift, 2) their long-history of incredible support does not matter, and 3) our relationship with them is no longer important. It is critical to continue engaging this donor segment given that the median boomer is scheduled to turn 65 in United Way alienates many of these retirees by not understanding where they are in life, and in turn, pressuring them to continue to give at a level they may not be comfortable with continuing to fund. Retirees, especially Tocqueville retirees, want to continue to be engaged in the work. They are passionate, have great skills, and can truly make an impact. They are also looking to explore other ways they can help outside of an annual cash gift (volunteer, planned gift, open doors, strategic plan, etc.). 3

Objectives for Tocqueville Sustainer Implement a multi-year strategy that encourages a focused, targeted approach for continued partnership with retired donors. As a coveted donor is making long term financial decisions as they prepare for retirement, we should be helping them think about how to continue to meet their philanthropic aspirations through diversified revenue streams. Still a member of the Tocqueville Society, each United Way continues to recognize the donor as Tocqueville or Tocqueville Sustainer, but the funding changes to a gradually decreased annual cash gift paired with a planned gift, and the name recognition stays as Tocqueville or changes to Tocqueville Sustainer, depending on each United Way’s preferences. The strategy continues to recognize, thank and steward donors who have been loyal, committed Tocqueville donors but may no longer, in retirement, be able to fund a $10,000 annual gift from income or cash. 4

Benefits Stems donor loss and promotes ongoing campaign revenue Captures a portion of the $6.3 trillion expected to be made in charitable bequests by baby boomers in the coming years Promotes a focused fundraising strategy Enhances volunteer engagement Corporate partners – corporate donors may be more willing to provide access to retiring donors, since these employees will no longer be in the workforce, and we are positively engaging these retirees in meaningful work in the community 5

Architecture of the new donor fundraising strategy

Tocqueville Sustainer gifts should include the following components but allow for flexibility First year $10,000 Second year $7,500 Third year $5,000 and remains at this level, and can only be designated to United Way * Example only - step down increments should be decided on by the donor and their UW. Annual Gift ‘step down’* Tocqueville donor pairs annual, undesignated gift with: Bequest of a meaningful amount in their estate plans Charitable gift annuity** Gift of appreciated stock Annual gifts from IRA or retirement plan Gift of property Paired with a Planned Gift 7 ** Providing a guaranteed income stream for life, a charitable tax deduction in the year of the gift, and partially tax free income with their annual CGA income stream.

Flexibility of application Retain donors as Tocqueville Require minimum planned gift of $50,000 Continue to recognize as Tocqueville Retain donors as Tocqueville Require minimum planned gift of $50,000 Continue to recognize as Tocqueville Engage donors on a different level Suggest a “meaningful” planned gift Amend recognition to Tocqueville Sustainer Engage donors on a different level Suggest a “meaningful” planned gift Amend recognition to Tocqueville Sustainer 8 Scenario #1Scenario #2

Criteria for inclusion Retired or soon to retire Eligible for existing Tocqueville donors only Financial capacity should be assessed by each United Way to determine whether this is a suitable option for each retiring or retired donor Selective approaches to “at risk” donors (note – this is not to be used as a mass marketing tool) 9

Examples of recognition and engagement for participating donors More a donor engagement strategy, than a recognition strategy Continue inclusion at all Tocqueville events and activities Add to any planned giving recognition events and engagements Recognize in leadership or planned giving recognition rosters Sample Roster Example: Tocqueville Society Members Frances Wisebart Jacobs S Jane Anne Smith Joseph & Beverly Timer S * S denotes a ‘Tocqueville Sustainer’ 10

Baby Boomers the retiring generation and their transfer of wealth

It is key for United Way to keep baby boomers actively engaged as they retire, but it requires targeted strategies focused on this growing population 17 percent of baby boomers have already retired For the next 18 years, 8,000 Americans will turn 65 every day - About a quarter million every month United Way has an older than average donor base relative to other nonprofits Source: AARP 12 Baby Boomer Industry Data

Current and imminent wealth transfers from baby boomers create a substantial opportunity for United Way Total Expected Wealth Transfer from Baby Boomers Expected Charitable Bequests IRA Assets in 2013 IRA Rollovers in 2013 $58.7 trillion* $6.3 trillion $6.5 trillion $324 billion* Source: Chronicle of Philanthropy and “Evolution of the Retirement Investor 2014” from Cerulli Associates *Chart not to scale 13

Baby boomers are retiring in substantial numbers with the median boomer due to turn 65 in 2017 Source: US Census Data,

Baby Boomer Fundraising Deliver Donor’s Philanthropic Vision MDR to $10MM Gifts MDR to $10MM Gifts Endowing Tocqueville Gifts $200,000+ Tocqueville Legacy Circle Gifts Continue Annual Support with Reduced Retirement Income Tocqueville Sustainer Tocqueville Sustainer Guaranteed Income Stream in Retirement Gift Annuity Donor Goal UW Vehicle Baby boomer fundraising strategies should be actively pursued by United Ways 15

Planned Gifts can be large and meaningful to United Way Planned gifts can be large in size and permanent, irrevocable gifts Life Insurance (irrevocable gift) Charitable Gift Annuity (irrevocable gift) Bequest (realized gift) Property/ Real Estate Average United Way Life™ policy about $330,000 Average United Way CGA in * $132,000 United Way bequests and bequest intents have included $1m plus gifts Average property gift is valued at $400,000 United Way Life™ policies range from $100,000 to $1 million United Way CGAs range widely up to $536,000 United Way of Amarillo and Canyon received $1 million bequest from long time workplace donor Most recent United Way Life™ single premium policy $304,725 Charitable remainder can be returned to the United Way within 3-4 weeks if CGA is reinsured United Way of Broward County received $500,000 bequest from $10 annual donor * 2014 through January 2015

The importance of engaging our retiring donors; the donor’s perspective “If we consider this from our donor’s perspective, retirement is going to be a change on so many fronts. They’re no longer supported by their workplace relationships; their schedule has changed; finding purpose in how their day now looks may be challenging, so I think if we can provide some continuity for them with some parts of their life remaining the same, we can position it as “we’re still here and want to be a part of the next chapter of your life”. We can give them engagement/volunteer opportunities to continue to put their experience and intellectual property to use; and they can continue to interact with the same network within their United Way and Tocqueville family. So, as this evolves, I think this is just a small part of what our Retiree strategy needs to looks like. If we don’t build out a robust engagement strategy for our retiring baby boomers, not only are we potentially missing out on the wealth transfer and legacy gifts, but we’re also missing out of being a resource and facilitator for a great deal of intellectual capital and life experience that can be tapped to benefit our next generation of leaders.” Sharon Clark Director, Individual Engagement Major Gifts and Legacy Giving United Way of Northeast Florida 17

Questions, contact Jennifer Gipp at UWW Evelyn Morgner at UWW Pilot Cities  United Way of Central Carolinas  United Way of Central Iowa  United Way of Central Maryland  United Way of Greater Toledo  United Way of Northeast Florida  United Way of Southeastern Michigan 18