Do you think you can spot a major donor off the street? Consider billionaire Sam Walton of the Walmart dynasty. He often wore faded jeans and boots, and drove a very old truck. Nothing about him, outwardly screamed “wealth”. The old adage, “You can’t judge a book by its cover” holds true with donors.
Who are the major donors?
Don’t assume you can recognize someone’s income by their lifestyle. Instead, realize that finding a major donor can be much more systematic. They usually look like the following:
- Business owners
- Serial entrepreneurs
- Real estate developers/owners
- Professionals (doctors, lawyers, CPAs, business executives)
Why are they important?
Today, major donors are more important than ever. They are the least impacted by the new tax laws implemented under the 2017 Tax Cuts and Jobs Act. They are also the donors with the most ability to give. Have you heard of the 80/20 rule in marketing? Typically 80 percent of profits come in from 20 percent of customers. However, among nonprofits, we’ve observed that this trend is closer to the 90/10 rule—90 percent of donations may come from 10 percent of donors.
These donors also play a large influence in your church. Their contagious generosity can inspire a spirit of giving among your entire congregation. As they get excited about generosity and become an influencer in the church, others will follow.
What are major gifts?
Many major gifts are usually $50,000 or more. In order to see these kinds of gifts, it’s helpful to think about the form that they come in. Most ministries are used to receiving gifts in the form of cash—either by check or an online gift. But most donors’ wealth is tied up in more complex assets. By allowing them to give the asset, they can reduce tax while increasing their giving. These assets are usually interests in real estate or closely held businesses. If you need help in receiving this kind of gift contact us at www.thesignatry.com.
Finally, another opportunity for a major gift is when a business owner is selling a business. The sale of a business is usually the biggest tax bill the owner will ever have to pay, and many times a charitable gift can significantly reduce taxes. But in order to give more and pay less tax, the business owner must give before they sign their sale agreement. We’ve found that many ministries can be part of helping complete a major gift if they encourage a donor to contact us before the sale.
How can you minister to them?
Recognize that major donors face many issues that might be unfamiliar to those in full time ministry. Major donors often worry about running their business, paying taxes, or preparing for a business sale. Even if you’re not an expert on the issues they’re facing, you can still help by pointing them to resources.
You can also help by preaching a message of generosity and reminding them that God owns everything. Whatever their business or career, God has a purpose for it. They can be surrendered to him and using their business to honor him because it is his in the first place.
For more year end giving training resources click here.
About the Author:
Bill High is CEO of The Signatry, a global Christian foundation. He has coauthored Giving It All Away … And Getting It All Back Again: The Way of Living Generously with Hobby Lobby founder David Green. For more information on creative giving solutions, visit www.thesignatry.com/lifeway.