Do You Have a Clear Way for Donors to Give Stocks?

Giving complicated.

Does your organization have a simple and clear way for your donors to donate stock or other investments?

If not, you’d be smart to get started!

Here’s why this is important…

Most wealthy donors have some of their money in cash (checking and savings accounts). Think of this as a small bucket.

But MOST of their money is in investments (stocks, bonds, IRAs) where it can earn them more money. Think of this as a large bucket.

And right now, this large bucket of investments is likely doing well.

If you only accept cash gifts from donors, they will likely donate from their small bucket of cash.

But if you make it easy to donate stock and other investments, donors can give out of their large bucket of invested wealth, while also receiving some nice tax breaks.

Your donor loves your cause and your organization. She wants to do what she can to help. And when you have a simple, clear way for your donor to donate stock or other investments, she may be able to give more than she could if you only accept cash.

That’s a win-win!

If your organization doesn’t have simple way to accept gifts of stock or other investments, it’s worth the bit of up-front work it takes to get started.

You’ll need to:

  • Open a brokerage account for your organization. Compare a few to find one with the lowest fees. Two of the most common are Fidelity Charitable and Schwab. Someone on your team will need to monitor this account periodically.
  • Set up policies and procedures so that everyone in your organization knows how to handle stock gifts, including receipting.
  • Let your donors know they can transfer stock and investments to your org. When they transfer the stock instead of selling it themselves, they can avoid capital gains taxes. They may also want to check with their financial advisor.
  • Have simple instructions for giving stocks and investments on your website and on a one page handout you could give to a donor.

For more detail on getting your organization ready to receive gifts of stock and investments, here’s a helpful resource from FreeWill.

And here’s the bottom line:

The stock market has been performing well in the last year, which means donors have more money to give… IF you accept gifts of stock and investments. Take the time now to set up a simple, clear way for donors to give, and you’ll see the benefits for years to come.