Why now more than ever, it’s critical to understand your constituents

By Jennifer Robins

Whether you are a local non-profit on a shoe-string budget or a large national organization, understanding your constituent base and trends is critical to finding success in any given year, but increasingly relevant during a pandemic.

As we crossed the one-year anniversary of the pandemic and reflect to one of the most discussed areas of fundraising, legacy giving, I wanted to take a moment to dig into why your charity or not-for-profit organization should jump on this bandwagon.

Having worked with hundreds of not-for-profit clients over the past several years, there has been an evident shift in the conversation since the start of the COVID-19 pandemic. This challenging time has placed a spotlight on the importance of having a will, and for many thinking about the legacy they want to leave behind, which is not entirely surprising. It does not hurt that innovative companies like Wilful are leading the way by making creating a will, just so much easier.

Data geek that I am, I am going to use stats to paint the picture of the current landscape before diving deeper into how your charity or not-for-profit can seize the opportunity by identifying and deepening the discussion with your constituents about the kind of legacy and impact they want to make.

Key trends on transfer of wealth in Canada
As Canada’s aging population and their net worth are projected to grow significantly over the next 10 years, the largest intergenerational transfer of wealth is expected to take place by means of inheritance. To-date nearly one-third of Canadian families have received some form of financial inheritance accounting for a total market of $576 billion according to Statistics Canada’s recent Survey of Financial Security. This inheritance value is expected to top $1Trillion by 2026. This is a significant moment in Canadian history and presents such an opportunity for not-for-profits to amplify the conversation about legacy gifts and how they can benefit Canadians today and tomorrow.

Boomers and the Silent Generation make up over 35 percent of the Canadian population, and they are the primary source for this wealth transfer. Many in this mature demographic have shown a strong desire to leave behind a legacy, primarily to their families but also to their communities. Unlike in times past, a large proportion of monies transferred in the coming years will be gifts that will be given during that person’s lifetime; there is a desire to see loved ones enjoying their inheritance whether that is through the pursuit of higher education or purchasing a first home or a dream vacation. With 40 percent of inheritance expected to be received by those 54 and under, the beneficiaries of these gifts will primarily be Gen X (age 40 to 54) and Millennials (age 25 to 39).

This new generation of beneficiaries is going to dramatically change the conversations you will be having with your organization’s donor base. Currently, these are likely annual and monthly givers, whose discretionary income has to-date been tied up in hefty mortgages and childcare payments, who very likely will start to see some relief with gifts from their parents and grandparents.

Inheritance across the country
Not only are the landscapes across Canada different, from the Rocky Mountains on the Pacific Coast to the soft rolling hills of Atlantic Canada, but demographics, wealth and inheritances differ as well. Organizations that operate on the ground-level of these varying geographies know that something that works in Edmonton, Alberta is likely not going to be as effective in Montreal, Quebec.

When looking across the country, some interesting insights can be gleaned in terms of inheritance opportunities. In 2020, the estimated inheritance value was projected to be $36 Billion dollars, with Ontario, Quebec, British Columbia, and Alberta holding the lion’s share of 85 percent of the total national inheritance — not surprising given their population sizes. However, when digging a little deeper there are some key differences between these provinces, as well as the largest cities in the country.

The average inheritance in British Columbia was $180,000, which is more than double the amount received in provinces such as Manitoba, Quebec, or Newfoundland. While looking at the major cities, the city of Toronto has the highest incidence, almost double the number of households in Montreal who had expected to receive an inheritance in the next year. While the city of Vancouver, with fewer households projected to have received an inheritance, the average inheritance value is over $250,000 and the highest amongst all major cities.

Now thinking about individual organizations, how can you leverage this information on a more local level? Knowing your catchment areas, your constituent base and regional needs can help inform and support any initiatives that you take. Recognizing and appreciating that the opportunities across the country differ and that your success in Kirkland, Ontario will look different than a colleagues’ success in Dauphin, Manitoba is important.

What does this shift in landscape mean for fundraising team?
Factoring in some of the key trends outlined above, how can your fundraising and planned giving team cultivate these donor relationships to maximize gifts over the coming years?

Leveraging the study conducted by the Canadian Association of Gift Planners (CAGP), we know that a large proportion of Canadians view bequests as an either or — either leave a bequest to a charity or leave a bequest to my family. We in the charitable sector know that it does not have to be black and white, there is a lot of room for grey. Recognizing that a large contingent of Boomers want to see their legacy flourish in real time, perhaps now is the moment to think about blended gift asks — a gift now that they can see realized, and an additional gift as a bequest.

Conversely you and your organization can also start to dig into those younger beneficiaries and how you can reach them. Since many are likely current annual and monthly donors in your database, the key is understanding which are going to be receiving an inheritance, stewarding these constituents, and zeroing in on the right messaging to build that relationship over the long term. Being able to identify who these recipients are, can help organizations tailor their communications to align with the core values and beliefs of these constituents. Their priorities today are likely very different from those of their Boomer parents, and it may simply be a matter of educating them of the impact their families can start to make today.

With the outlook for the Canadian economy projected to continue to tighten as the pandemic continues through 2021, this is a great time to pause and evaluate if you and your organization are well positioned to benefit from the unprecedented transfer of wealth in the coming years.

Jennifer Robins is Environics Analytics’ Not-For-Profit Lead. She has more than three years of experience helping charities of all sizes use #DataForGood to achieve their fundraising goals.

Sources: Statistics Canada’s Survey of Financial Security; DemoStats 2020; SocialValues2020;
Source: Statistics Canada Survey of Financial Security. https://www.willpower.ca/about/

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