Smart ideas delivered every other Tuesday from Hartsook Companies, Inc.

April 4, 2006

Part I of II: Will Inheritances Continue to be Life Changing?

For decades, development professionals and researchers alike have predicted that as we entered this century the exchange of wealth from generation to generation will be greater and larger than ever before. While roughly $200 billion continues to exchange hands annually, things are not as rosy for the next generation as they once appeared to be. Rising costs in nursing homes, diminishing returns on investments and other major economic factors are causing children to reconsider the extent of their inheritance.

New York Times' Eduardo Porter recently wrote, "While some forecasters still hope the vast pool of wealth accumulated by the generations born in the first half of the 20th century will prop up the finances of the aging offspring, new statistics provide a starker picture." According to Porter, latest numbers confirm that baby boomers won't be able to count on their upcoming inheritance to get them out of financial jams quite as anticipated. Why? Because life expectancy has increased and retirement financing has decreased. This, coupled with the following findings, is causing a widening gap between the "haves and the have nots" even when it comes to future inheritance.

In 2004, the Federal Reserve reported that the median inheritance amounted to just under $30,000 - certainly not a life-changing amount. Thirty years ago, the median was about $40,000.

According to Hurd and Smith of the RAND Corporation, half of the children of parents born from 1931 to 1947 (parents who today are 60 to 75 years old) will inherit less than $20,000. The top five percent are estimated to receive nearly $250,000.

While all of the above is interesting food for thought, you might be wondering how this information impacts you as a professional. The April 18 issue of Strategies for Success will explore practical ways to utilize your awareness of predictions and trends to make you a keener negotiator as you visit with families seeking investments in your organization.

Another smart idea...From the Hartsook Best Practices Collection^SM

"We sponsor the USU/Community Associates, an organization of university faculty, staff and community leaders, including the university president. Its members, who are invited to join and pay $75 to belong, meet twice a year - once on campus and once in the community. They discuss and explore issues of campus and community importance and interest. Our gatherings include a reception, a display and a presentation by one of our colleges, departments or businesses in town. They end with student or community entertainment. This is pure relationship-building and cultivation - no solicitation occurs. At the same time, many members are donors; those who aren't usually become ones eventually. - Jan Appuhn, CFRM, Utah State University (Logan, Utah)

If you're interested in Best Practices, check out these additional resources from Hartsook Companies:

• "Reality Fundraising: Proven, Practical Ideas for the Enlightened Fundraiser" by Bob Hartsook (2005, ASR Philanthropic Publishing). The book features great ideas, insights and lessons learned through hundreds of best practices from nonprofit professionals nationwide. To order the book, follow this link: http://www.asrpublishing.com
• "Best Practices Coast to Coast^SM," a compilation of best practices from every state in the union
• "Another Two Dozen Best Practices and Great Ideas^SM," a special edition which features suggestions from 24 Hartsook Companies consultants
• "Hartsook Best Practices Collection^SM," our original collection of 250 best practices and great ideas

For a free copy of any or all of the "Best Practices" collections, please email Erika Turner, erika@hartsookcompanies.com, or visit our web site at http://www.hartsookcompanies.com/bestpractices2.shtml. We also invite you to contribute your own best practice by emailing Tami Druzba, tami@hartsookcompanies.com.

Interested in Speakers?

Hartsook consultants are available to speak to your organization on a variety of topics. To read more, visit http://www.hartsookcompanies.com/speak.shtml or email Tami Druzba at tami@hartsookcompanies.com to discuss the possibilities.

Visit the Hartsook Companies web site for:

• Educational opportunities
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• Conference/workshop speakers

Strategies for Success explores smart ideas, connecting with more than 1,500 fundraising professionals bi-weekly. We welcome your contributions or comments. If you'd like a free subscription to Strategies for Success - or its monthly companion, eHartsook on Philanthropy - contact Erika Turner, erika@hartsookcompanies.com. You also can reach her at 316.630.9992.

Our web site is located at http://www.hartsookcompanies.com.