What is Planned Giving, and Why Does It Matter for Nonprofits?

Key Takeaways for Nonprofit Leaders

• Planned giving means a charitable gift funded through a donor’s estate or overall financial plan, such as a will, retirement account, or stock portfolio, rather than their immediate checking account.

• You do not need a massive development team or a dedicated planned giving officer to receive legacy gifts. Nonprofits of every size are already receiving these gifts, often without even knowing it.

• Bequest giving surged 19.7% in 2025 to $62.19 billion, outstripping standard cash appeals. The real question isn’t whether your organization should build a planned giving program; it’s whether you have the visibility and tools to capture the gifts already hiding in your donor base.
  

What is planned giving?

Planned giving, often referred to as legacy giving or deferred giving, describes a contribution a donor arranges now that your organization typically receives later. Unlike annual cash appeals that ask supporters to part with immediate checking account liquidity, planned gifts are funded through a donor's overall estate or financial assets.

Five primary gift types

1. Bequests Through a Will: A gift named directly inside a donor’s last will and testament or trust. This is the most common form of planned gift, and usually the simplest for a supporter to set up.
2. Beneficiary Designations: Naming your organization as a full or partial beneficiary on a retirement account (like an IRA or 401k), life insurance policy, or bank account. These bypass the will and probate process entirely, transferring directly to your cause.
3. Qualified Charitable Distributions (QCDs): A tax-advantaged direct transfer from an IRA for donors aged 70½ or older. Because pre-tax withdrawals satisfy Required Minimum Distributions without increasing taxable income, this is one of the fastest-growing ways retirees fund causes they love.
4. Donor-Advised Fund (DAF) Grants & Successions: Donors recommending grants to your organization from funds they have already set aside for charity, or naming your cause as the successor beneficiary to their DAF account.
5. Gifts of Appreciated Stock: Donating appreciated securities directly to your organization. Donors avoid capital gains taxes while your nonprofit receives the full market value.  

Why does planned giving matter right now?

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Crucially, between 2023 and 2025, bequest revenue from estates valued under $1 million grew by 53.5%, faster than either the $1M–$10M tier (+26.3%) or mega-estates.

This growth isn't concentrated exclusively at universities or major health systems with dedicated gift-planning departments. It is showing up across the entire sector, including organizations with zero paid staff.

What does this look like with no dedicated planned giving team?

An organization run entirely by volunteers ended up running an asset-first giving program. Not because it had an enterprise strategy document or a planned giving officer, but because it made space for donors to give from what they own, not just what was sitting in their liquid checking account.

The barrier to receiving these transformational gifts is far lower than most teams assume.

Why Legacy Programs Stall Before They Start

If the financial returns are this high, why do so many organizations hesitate? It usually comes down to two operational hurdles:

1. Bandwidth: Development teams are stretched thin across grant deadlines, annual appeals, and event logistics. Planned giving operates on a longer timeline and frequently loses to whatever deadline is due this week.

2. Confidence Gap: In sector reporting, nearly two-thirds of development staff admit they don't feel confident discussing planned giving concepts with a donor. When staff feel intimidated by legal jargon, conversations don't happen, even when a loyal donor would have said yes if asked.

Three Pillars to Capture Legacy Gifts

Strip away the legal jargon, and a working planned giving program requires exactly three things.

1. Plain-Language Donor Education: A way to explain, in plain terms, what a bequest or beneficiary designation actually is. Research shows that asking users simple questions like "Would you like to leave a gift in your will?" doubles donor participation compared to technical phrases like "charitable bequest".

2. Staff Bandwidth and Expertise: Someone comfortable enough with the topic to raise it, answer donor questions, and follow up consistently.

3. Gift Visibility: A way to know who has committed a gift. Historically, 64% of legacy pledgers never notify the charity, leaving organizations in the dark until an estate settles years later.

Building all three pillars from scratch can feel overwhelming. Fortunately, a modern planned giving tool solves all three at once. By using LotusGiving, your organization can instantly activate plain-language donor education, leverage expert support, and gain real-time visibility into incoming legacy gifts without adding staff overhead.

Modern Tools Built for Scaling Planned Giving

LotusGiving was built specifically around how nonprofits can start a planned giving program without adding a dedicated team:  

For Donor Education & Action: The LotusGiving Planned Giving Microsite gives your organization a dedicated, white-labeled destination. It explains wills, beneficiary designations, QCDs, DAFs, and stock gifts in warm, plain language on your domain, branded to your cause. Beyond education, our guided suite provides supporters with an intuitive, 15-minute tool to write legally sound wills, manage their estate plans over time, and update their gifts as life changes.

For Real-Time Visibility & Follow-Up: The LotusGiving Dashboard eliminates the "silent bequest" problem. You get immediate visibility into which donors have included your cause, complete with specific gift details and contact information so your team knows exactly who to steward and follow up with.

For Staff Bandwidth & Expertise: LotusGiving Fractional Planned Giving connects your organization with an experienced planned giving professional on an as-needed basis. Drawing from the LotusGiving Open Ecosystem network of vetted consultants and estate planning professionals, your team gets expert strategy, donor conversation support, and stewardship assistance without a full-time hire.

Go Live in Four Simple Steps

1. Set Up Your Account & Brand: Bring your organization’s name, logo, and mission story.
2. Set Up Your Hosted Donor Page: Establish a dedicated, high-trust destination where donors land when they’re ready to learn more or start a free will.   Integrate With What
3. Integrate Your Tools: Connect platform activity to your CRM so legacy-giving data doesn't live in a separate silo. 
4. Automate Your Invites: Set an automated cadence to invite supporters, whether as a seasonal stewardship campaign, a newsletter mention, or an ongoing background process

Frequently Asked Questions

Do we need a planned giving officer before we start?
No. That is precisely the gap LotusGiving Fractional Planned Giving and the Open Ecosystem network fill: providing expert planned giving leadership without a full-time hire.

Isn’t planned giving only relevant to universities and large institutions?
No. As the GOSUMEC Foundation example demonstrates, organizations with zero paid staff can generate 85% of their donations through asset-based giving when given the right tools.

How long does it take to see results?
While planned gifts settle over a multi-year horizon, digital platforms provide immediate returns. You gain real-time visibility into new donor commitments, and studies show that donors who commit a legacy gift increase their immediate annual cash giving by an average of 75% to 77%.