Planned giving: How to start small for big giving

⚖️ Disclaimer: This content is for general informational purposes only and does not constitute legal, tax, or accounting advice. Rules around charitable pledges and planned gifts can vary by state and situation, so it’s always wise to consult qualified professionals when navigating major or complex gifts.

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Planned gifts are often some of the most meaningful and impactful contributions a donor will ever make. In fact, among the top 1,000 legacy-supported charities, planned giving accounts for roughly 30% of total fundraising income. 

Still, many nonprofits hesitate to explore planned giving. It can feel intimidating, overly technical, or “too advanced” for smaller teams. The truth is, planned giving doesn’t have to be complicated, expensive, or reserved for large organizations with dedicated staff.

Planned giving can start small, grow naturally, and fit seamlessly into your current donor stewardship. With the right approach, it becomes less about legal structures and more about helping loyal supporters extend the impact they already care deeply about.

Below, you’ll find a clear, practical breakdown of how planned giving works, which options are easiest to start with, and how nonprofits can move forward confidently, without overhauling their fundraising strategy or taking on unnecessary risk.

Key takeaways 

• Start with your most loyal donors ⭐ You don't need major or high-wealth donors to begin. Focus on your most consistent and strongest relationships instead.
  
• Choose the simplest planned giving options ✅ Bequests and beneficiary designations are the best starting point.
• Track intent and set clear goals 📊 Get clear on what you’ll track, how you’ll track it, and why to avoid board or financial confusion.
• Lean on advisors when you need them 🤓 You don't need legal expertise to begin, but it’s helpful to reach out for support when conversations get technical.
• Lead with the mission 💛 Keep giving human by focusing on the impact a planned gift will have and why it matters, not just the mechanics.
• Promote consistently 📣 You don’t need fancy planned giving brochures or major launch campaigns. Make donors aware of planned giving through sidebars, website info, and even in email signatures.
• Do it all with Givebutter 🧈 Use Givebutter to tag and track legacy interest in a CRM, create a simple legacy giving page, and nurture donors over time, all in one place.

What is planned giving?

Planned giving is a thoughtful way for donors to extend the impact of their generosity through long-term financial or estate planning. These gifts may support a nonprofit during a donor’s lifetime or, for many supporters, continue their commitment as part of their legacy after they’re gone.

For donors, planned giving is a meaningful way to care for the causes that matter most to them—often reflecting values, gratitude, and a desire to make lasting change. For nonprofits, these gifts provide future support that helps sustain programs and mission-driven work.

While financial contributions are the most common, donors can also choose to give a variety of assets during their lifetime, including:

• Real estate
• Artwork or other valuables
• Stock in a company
• Funds from a retirement account, such as a 401(k)
  

What are the different types of planned giving?

Planned giving for nonprofits comes in several forms, each with different structures, benefits, and timelines. Rather than legal classifications, the categories below offer a practical way to think about how and when planned gifts typically support your organization.

• Deferred planned gifts 😇 These gifts are typically realized in the future, most often after a donor passes away. Common examples include bequests and beneficiary designations tied to estate plans.
• Planned gifts that provide income to donors 💸 These arrangements allow donors to support your mission while receiving income during their lifetime. A portion of the gift is eventually retained by the nonprofit.
• Planned gifts involving non-cash assets 💪 These gifts allow donors to contribute assets—such as property, investments, or other financial instruments—often while maintaining some flexibility or control.

✍️ Keep in mind: These categories aren’t formal legal definitions. Many planned gifts can overlap categories or function differently depending on the donor’s situation, but this framework offers a helpful way to understand how planned gifts typically work.

More to explore

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10 planned giving examples for nonprofits

Now, let’s explore these categories in more detail with practical examples of planned giving programs to visualize the possibilities for your donors. 

1. Bequests 🎁

A bequest is one of the most common and accessible planned giving options. It’s a gift a donor designates to a person or organization through a will or living trust, and it takes effect after the donor’s death.

Charitable bequests are often structured as:

• A specific bequest: A fixed dollar amount or particular asset
• A percentage bequest: A portion of the donor’s estate (for example, 10%)
• A residual bequest: What remains of the estate after other obligations are met
• A contingent bequest: A gift made only if certain conditions are met

Bequests can be funded with a variety of assets, including cash, securities, or real estate, depending on the donor’s estate plan.

💰 Type of planned gift: Deferred

💛 Great for: Donors who are creating, updating, or reviewing their wills and want to make a lasting impact without affecting their current finances

2. Retirement plan gift 🌴

Donors can name your nonprofit as the beneficiary of a retirement plan, such as a 401(k), IRA, or pension, either in part or in full. Your nonprofit receives the donation, and donors avoid income and estate taxes on those assets.

💰 Type of planned gift: Deferred ‍

💛 Great for: Donors who don’t need the retirement assets and want tax benefits

3. Life insurance gift 💙

Donors can name your nonprofit as the beneficiary of their life insurance policy and receive tax advantages on the remaining amount.

💰 Type of planned gift: Deferred 

💛 Great for: Donors with paid-up policies who no longer need coverage or who don’t have personal beneficiaries

4. Charitable gift annuity 💰

With a charitable gift annuity, a donor transfers cash or stock to your nonprofit in exchange for fixed payments for life. After the donor passes away, the remaining funds support your nonprofit.

💰 Type of planned gift: Planned gifts that pay donors back

💛 Great for: Donors who want to make a substantial gift but need some income now

5. Pooled income fund 👥

A pooled income fund combines gifts from multiple donors. You’ll invest their contributions and pay dividends to your donors for the rest of their lives. After each donor passes away, their share of the fund is distributed to your nonprofit.

💰 Type of planned gift: Planned gifts that pay donors back

💛 Great for: Donors interested in investment-based giving 

6. Retained life estate 🏡

With a retained life estate gift, your donor transfers the deed for a property to your nonprofit while retaining the right to live in or use the property for a set period of time. The donor also continues covering maintenance and expenses. In exchange, they receive a charitable tax deduction.

💰 Type of planned gift: Planned gifts that let donors use their assets

💛 Great for: Donors who want to donate property but continue using it temporarily

7. Donor-advised funds (DAFs) 💎

A donor-advised fund (DAF) allows donors to contribute assets—such as cash or appreciated securities—to a charitable account and recommend grants to nonprofits over time while receiving immediate tax benefits.

Most DAF gifts are made during a donor’s lifetime. However, DAFs can also be used in estate planning by naming a nonprofit as a beneficiary, making them relevant to planned giving conversations.

💰 Type of planned gift: Lifetime planned gift (with optional estate component)

💛 Great for: Donors who already use DAFs and want a flexible, tax-efficient way to support your mission now or in the future

8. Trusts 🔒

With charitable trusts, donors place assets, such as property or cash, into an account managed by trustees. The trust can provide income to the donor or their heirs, with the nonprofit receiving the remaining assets. 

💰 Type of planned gift: Gifts that provide income to donors or their heirs

💛 Great for: High-net-worth donors

9. Qualified Charitable Distribution (QCD) 🧓

A QCD allows donors aged 70½ or older to transfer funds, up to the IRS annual limit, directly from their IRA to a nonprofit. The distribution counts toward required minimum distributions (RMDs) but isn't included in their taxable income.

💰 Type of planned gift: An outright gift 

💛 Great for: Older donors seeking tax-efficient ways to give now 

10. Appreciated stock 📈

Donors can transfer appreciated stocks, bonds, or mutual funds directly to your nonprofit. They avoid capital gains taxes and can deduct the full fair market value.

💰 Type of planned gift: An outright gift 

💛 Great for: Donors with investment portfolios who want to maximize tax benefits

What are the benefits of planned giving?

While planned giving might feel complex or intimidating at first, it offers meaningful benefits for both small nonprofits and established organizations. 

Benefits for nonprofits

• Raise more money 💰 The average charitable bequest is around $78.6K, making planned giving a powerful long-term fundraising opportunity.
• Expand their major donor pool 👥 Planned giving gives donors ample time to plan and save to make a significant gift. 
• Build a foundation for the future 🚀 A planned giving program helps nonprofits align their long-term vision with today’s needs and ensure future sustainability.
• Encourage ongoing support 🔄 Planned giving often boosts recurring donations, with organizations seeing up to a 75% increase in annual giving from participating donors.

Benefits for donors

• Leave a lasting legacy 💛 Legacy gifts allow donors to create impact that continues long after they’re gone. 
• Control how funds are used 💪 Donors can clearly outline how they want their gift to be distributed in their financial or estate plans.
• Enjoy unique financial benefits 💸 Many planned gifts are tax-deductible and can provide income streams or tax advantages for donors and their heirs.

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How to start a planned giving program (even with a small team)

The truth is, you don’t need to have a full-blown planned giving program, a large donor base, years of experience, or even a large team to get started. 

In fact, you just need a few simple elements: clear messaging, a few loyal donors, and light promotion.

Step 1. Start with loyal donors 💛

One of the biggest myths around planned giving is that nonprofits need to focus exclusively on major donors or high-net-worth individuals. In reality, that’s not often the case.

"Planned giving is not only for your wealthy donors,” says Tony Martignetti, planned giving evangelist. “If you have a donor who's been giving to you for 10, 20 years and their average gift was $10...they’re an ideal prospect for planned giving.”

When beginning your program, focus on donors who:

• Have a history of giving ⏳ Look for people who've given consistently for several years, regardless of gift size.
  
• Mention legacy giving in conversations 💭 Try to tune in for phrases like "I wish I could do more" or "I want to make sure this work continues."
  
• Already give generously 💰 Identify your current top donors. They might be well-positioned to consider planned giving.

Step 2. Choose a few planned gift types 🎁

Planned giving can feel overwhelming when nonprofits assume they need to offer every option. Instead, start with just a few gift types to reduce your team's stress and keep your asks and promotion focused.

A smart approach is to begin with bequests and beneficiary designations, since they’re among the easiest for donors to set up and for nonprofits to accept. 

As Tony puts it: "There are three things that folks need to include you in their will: your legal name, your federal tax ID number, and your address. That's it." 

Step 3. Track intent & set clear goals 📊

As with any fundraising effort, you’ll need to get clear about how you’ll measure your progress. To do that, make sure to:

• Distinguish intent from commitment 🤝 Count only written, valued, and unconditional commitments toward goals. Pledges should be tracked separately.
• Separate expectancies from realized gifts 💸 A donor notifying you they’ve included your organization in their will is meaningful, but that doesn’t mean you have those funds yet. A realized gift only occurs when you receive funds.
• Set the right goals 🏆 Planned giving is about long-term relationships. Track engagement metrics, such as conversations or event attendance, to get a holistic picture of your program.
• Track unrealized gifts separately 🗂️ Separate planned gift intentions from annual fundraising totals until the gift is realized to avoid cash flow confusion and keep reporting clear.

Step 4. Talk to advisors when needed 🤓

You don't need attorneys or financial experts on staff or on your board to launch a planned giving program. Still, it’s important to recognize when outside guidance is helpful. 

Here’s a quick rule of thumb: 

• You might need an advisor if ✅ You’re accepting non-cash bequests, such as real estate, drafting gift acceptance policies, or considering large or restricted gifts. 
• You likely don't need an advisor if ❌ You’re having introductory conversations with potential donors, promoting planned giving broadly, or accepting simple bequest notifications.

Encourage donors to consult their own advisors whenever conversations become technical, involve tax implications, or include questions about what planned gift type is best for their situation.

Step 5. Lead with mission & relationships 🤝

You don’t need a fancy brochure or technical tax content to succeed with planned giving. What matters most is a clear mission, thoughtful legacy storytelling, and strong donor relationships. 

To get started, focus on the following:

• Tell stories that inspire action 📖 When a donor includes you in their will, ask permission to share why they chose your organization. Highlight their connection to your mission, not gift amounts, and show how their contribution creates a meaningful impact.
• Emphasize gratitude and long-term stewardship 🫂 Frame planned gifts as an opportunity for donors to extend their impact. Continue sharing updates, inviting supporters to events, and thanking them for their commitment.
• Avoid transactional or urgency-driven language 🚫 Keep the conversation relational. Tony suggests: “We're asking our most loyal donors to consider including us in their will as part of their long-term plans. Is that something you would consider doing for us?"

Step 6. Promote lightly & consistently 📣

Planned giving marketing doesn’t require significant time, energy, or money, and it doesn’t need to focus on death or estate language.

Instead, nonprofits should:

• Weave promotion into existing communications ✉️ Mention bequest gifts in donor communications like newsletters and emails, as well as on your website. 
• Prioritize consistency over volume 🔄 Donors often need gentle exposure to planned giving opportunities over months or years before they feel ready to act. 
• Keep the language simple and uplifting 💬 Focus your messaging on the positive impact and future sustainability that donors help create. “You're not talking about death. It’s about the long-term life of your nonprofit,” says Tony.  

⚡️ Example: Add a simple line like this to your newsletter footer, donation confirmation emails, or website sidebar: “Interested in leaving a legacy? Learn how you can include [Nonprofit Name] in your plans.”

Planned giving best practices 

If you’re ready to get started, these practical planned giving best practices work especially well for small teams.

• Balance visibility and intimacy 👋 While it’s important to cast a fairly wide net when soliciting planned gifts, your outreach should still feel personal and thoughtful. This can include phone calls, handwritten notes, and exclusive behind-the-scenes updates.
• Build relationships over bureaucracy 💛 Planned giving is about connection, not paperwork. When someone tells you they’ve included your organization in their will, thank them without immediately asking for documentation.‍
• Repurpose ♻️ When creating marketing materials, make sure they can be reused widely, such as email signatures, newsletters, and website sidebars, so you're not constantly reinventing the wheel.‍
• Use consultants as a safety net, not a starting requirement 🤓 Whether you’re experienced in legacy giving or not, you can talk about your mission, impact, and why long-term gifts matter. Outsource only the more technical aspects to experts when needed.‍
• Offer education when it makes sense 🎓 This could be as simple as sharing a recorded webinar, partnering with a community foundation, or hosting a small Q&A. Formal events are optional.‍
• Share trusted resources 💡 When helpful, provide a short list of trusted attorneys, accountants, or free educational tools. This doesn’t need to be exhaustive to be valuable.

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Make planned giving smoother with Givebutter 

Planned giving doesn’t need to be complex or reserved for large organizations. For small nonprofits, it often starts with strong relationships, clear communication, and a few simple options supporters can feel good about.

By focusing on loyal donors, choosing manageable types of planned gifts, and tracking intent thoughtfully, even small teams can lay the groundwork for long-term impact without overextending their resources.

Givebutter’s tools make that easier to sustain. Nonprofits can tag and track legacy interest in a free CRM, create a simple legacy-giving page that outlines options such as bequests and retirement gifts, and nurture supporters over time using custom segments and engagement tools, all in one place.

Planned giving works best when it feels organized, human, and manageable. Givebutter helps you keep it that way.

Get started with planned giving today. Sign up for Givebutter for free.

FAQs about planned gifts 

What’s the difference between legacy giving vs. planned giving vs. major gifts?

Legacy giving, also called legacy donations, refers to contributions made to a nonprofit after a donor has passed. Planned giving is an umbrella term for any gift that involves the donor's financial or estate planning, whether during their lifetime (e.g., annuities, trusts) or later. Major gifts are defined by size rather than timing and refer to donations that are significantly larger than average for a nonprofit.

Is planned giving only for large nonprofits?

No! Small nonprofit organizations can offer planned giving opportunities. You don't need prior experience, a formal program, or a large staff to get started. Simple legacy messaging, conversations with top donors, light promotion, and free CRM tools like Givebutter that help you nurture planned giving relationships. 

Do planned gifts count toward fundraising goals?

Planned gifts can count toward fundraising goals depending on your organization and the type of gift. But, they’re generally tracked separately from annual revenue to avoid confusion or cash flow issues.

What’s the difference between planned gifts and pledges?

A pledge is a promise to give a specific amount within a defined timeframe. A planned gift is usually realized later, either during a donor’s lifetime or after their passing, as part of their estate or long-term financial plan. 

How should unrealized planned gifts be reported?

Unrealized planned gifts should be tracked separately as commitments, not as revenue. With Givebutter, you can track both realized and unrealized gifts in one place, helping your team stay organized without overstating income.

Do we need a legacy society to start planned giving?

You don’t need a legacy society (a dedicated program that recognizes and thanks donors for this specific type of giving) to start planned giving. Still, it can certainly be helpful as your program grows.