A bequest program is where an organization starts when setting up a planned giving program. Most of your planned gifts will be from bequests.
Bequests are any assets bequeathed in a will or a trust. A bequest might be a specific amount of money or assets, a percentage of those assets, or the residual (what is left over after heirs and other obligations are paid) from an estate.
Beneficiary designations are gifts that occur outside of the will. This might be an Individual Retirement Account or an insurance policy. A donor can make a nonprofit the beneficiary of these financial instruments. IRAs can also simply be rolled over to a charity. For some individuals this makes sense to avoid the tax bill when they start taking money out of the IRA.
Making a nonprofit the beneficiary of an insurance policy is sometimes done by a donor whose children or spouse will not need the funds; or by a donor who would love to leave more money than he can actually afford to a beloved cause. Insurance policies can also be cashed out and donated to the charity.
Both bequests and beneficiary designations are the perfect place to start if a nonprofit wants to get into planned giving since they do not require any infrastructure to receive them. The donor's own financial planner sets up the instruments, and it is enough for the nonprofit to remind donors of these options and to encourage them to make their wishes known.
