On the surface, the project appears seamless – a plan that promises to change the face of philanthropy in the coming decades. No one can argue with the fact that a handful of mega-gifts can significantly impact overall giving. Giving USA 2010 showed that individual giving held steady in 2009, but only as a result of five gifts from high-net-worth donors totaling nearly $1.6 billion.  Without those gifts, overall giving by individuals in 2009 would have declined by 1.1 percent.  The problem with the Giving Pledge’s promise to change philanthropy, however, is that much of the money will not be transferred for years, and even then may be dispersed at a very slow rate.

Many of the families that have signed on so far have pledged to transfer their wealth after their death. Ron Rosenbaum of Slate magazine criticizes this practice.  “Show us the money if you want the credit,” he writes. “And show it to us now, before you die, not in some distant future where a lot of poor and diseased people will themselves have died for lack of timely aid.” While the pledging parties certainly have the option to transfer their wealth during their lifetime, it’s likely that in those cases the money will be funneled into charitable family foundations – and many of those foundations are only required to make grants totaling five percent of their assets each year. The argument is that it could take decades before the money finally trickles out to the organizations that need it now.

While I certainly agree with the above criticisms, the problem I see with the pledge is the spotlight it shines on the rare mega-gift, and the attention that it takes away from the everyday donor. While the donations made by the über-wealthy are certainly generous, in many cases they are not stretch gifts. Personally, I am far more moved by middle class families that have remained committed to supporting the organizations in their communities even in the face of their own pay-cuts and job losses.

Don’t get me wrong – overall, I think the Giving Pledge is a great project. But it would be sad to see organizations become fixated on claiming their piece of the mega-gift pie when there are so many mid-level donors that have continued to give, even when it hasn’t been easy.

To check for the latest updates on the IRA charitable rollover, check the Partnership for Philanthropic Planning’s website.

Here’s some statistics shared at the conference that demonstrate the value of having a healthy planned giving program.  I am not able to cite the sources of all of these, but I trust the reliability of the experts that reported them. 

1)  According to the most recent edition of Giving USA, released in June 2009, seven of the ten largest gifts from individuals last year were given as bequests or other planned gifts.

2)  The average estate gift nationwide is between $35,000 and $40,000. While most estate gifts are bequests or beneficiary designations (on life insurance policies, bank accounts or retirement accounts) and only pass to the charity at the end of the donor’s life, the investment today in securing the intention is small compared to the ultimate return.

3)  Cygnus Research reports that 45 percent of donors state they intend to leave a gift to charity in their estate plans; however, other sources report that only seven percent actually do, and of the wealthiest Americans—who receive the most benefit in reduced estate taxes—the number is 17 percent. This gap between “good idea intention” and actually completing the will, trust or related documents is ripe with opportunity for our sector.

With the budgets and staff at many nonprofits stretched thin, it may be challenging to think about allocating resources to securing gifts that will not be of immediate benefit.  However, focusing efforts on planned giving could position your organization for future sustainability without much initial investment.  At the same time, you’ll be creating opportunities for donors to make a meaningful contribution – even if they can’t afford to write a check today.