COVID Brought Boom Year for Ministry That Helps People Leave Money to Ministries
Editor’s Note: Many wealthy families and individuals use consultants to help them manage their finances. A growing number of high-capacity donors are using philanthropy consultants. These organizations help the donors develop giving strategies, and then make sure they stay on the plan over time. MinistryWatch will be profiling several of these organizations in the months ahead. The first article in this series features California-based Financial Planning Ministry.
When Al and Pam, a Colorado couple, married in their 60s and merged their assets, including each of their houses, they knew they had to create a new will and trust, which can cost many thousands of dollars, depending on how complex people’s finances are.
But thanks to seminars she had seen at her church, Pam knew about a nonprofit organization that provides free wills to people who are interested in eventually giving at least some of their assets to churches and ministries.
No one at Ministry Watch had previously heard of Financial Planning Ministry, a small, quiet group of attorneys, estate planners and tax experts located in Irvine, California.
FPM doesn’t promote itself through ads or publicity. It doesn’t need to. Its 130 partner ministries—about 90 of them churches, including big ones like Gateway, Lakewood, and Saddleback—spread the good news to their members about what FPM does.
Partners include camps, children’s homes, pregnancy centers, Christian schools and colleges, and well known ministries like Mission Aviation Fellowship, Jack Hayford Ministries, and World Vision. FPM is a member of the Evangelical Council for Financial Accountability.
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Since its founding in 1982, FPM has helped 36,000 families like Al and Pam designate more than $1.7 billion in future giving to ministries in their wills and trusts. The designations are made in wills or trusts, meaning that funds will flow promptly to ministries upon the donors’ deaths, rather than being parked in Donor Advised Funds for years or even decades.
COVID has only accelerated FPM’s work, while also forcing it to present its workshops virtually for most of the past year, which has resulted in younger families coming forward to put their plans in place. Requests for estate documents rose 38% during the latest fiscal year, which ended June 30. Designated giving rose 70%.
“The whole COVID situation brought issues like mortality and health care directives to the front of mind for many people,” said Michael Prior, FPM’s CEO, who previously served as executive pastor of Central Christian Church in Mesa, Arizona.
Founded by fundraising experts
In the early 1980s, a group of Christian leaders met weekly for coffee in Fullerton, California to discuss a shared frustration.
These leaders had heard donors pledge that they would remember a Christian college, a local camp, a local evangelistic association, and other ministries in their wills.
But many of these donors died just like most Americans die: intestate. They didn’t have a will or estate plan, so some of their assets were lost to probate, while some of the ministries received none of the money donors had promised to give.
“What can we do to help donors get across the finish line up with their generosity goals?” the Christian leaders asked each other over coffee.
They tried a few things—bringing in a local attorney to meet donors, sending ministry representatives out to talk in adult Sunday school classes—but none of them were very successful, before they came up with the current model: an independent ministry that would come alongside these ministries and churches, educating their people at informative seminars, then following up a few weeks later to meet with any interested donors, answer their many financial and legal questions, and perhaps even sign them up for a free will, which takes a few months.
“When people work with us, they find out we have no agenda,” says Prior, “and most of the time, we are working with people who are already understand our partner ministries’ purpose, and who already want to be generous to them.” FPM encourages, but doesn’t require, donors to leave assets to any of its partner ministries, but most do.
Sometimes, churches will invite FPM to presented seminar during the capital campaign drives. But Prior cautions ministries not to do a seminar as a fundraising event.
“We take a long-term approach toward helping people be good stewards,” he said.
The seminars let people know that even those of us who don’t own a huge estate like Downton Abbey still need to do estate planning.
“While we are living, most of us have access to only about 10% of our total assets,” says Prior. “the other 90% is tied up in various assets—a home, retirement accounts, life insurance—that we can’t touch.
“We can’t be very generous with those resources during our lifetimes, but when we pass on, suddenly it’s all freed up. That’s a great opportunity to be generous.”
FPM has helped families with assets of all sizes: from $20,000, to $20 million.
Each state has its own system, but if you live in Michigan, for example, and have an estate valued at only $22,000, that estate will go through probate if there’s no plan. In Colorado, the threshold is $70,000. In California it’s currently $166,250. (FPM has a web page listing probate thresholds for all 50 states.)
Funded by ministry partners
FPM receives only about $250,000 of its $2,357,990 annual revenue from the individuals it works with on estate planning documents. The bulk of its revenue—$2,104,196—comes from the annual contributions of FPM’s partner ministries.
Prior says those partner ministries’ contributions have proven to be a real bargain over the last five years. During that time, ministry partners gave FPM $10,427,549 in annual contributions. Down the road, these ministry partners are designated to receive more than $835,000,000 in future donations. “A return on contributions of 80 to 1,” said Prior.
Many thousands of dollars in donations will come from the money that donors did not pay for estate planning counsel and documents.
“Many communities are saturated with mailers and invitations from law firms and financial planners that invite people to a free for lunch, or they will often times hear a pitch for services that can cost them thousands of dollars,” said Prior.
But FPM has helped families save not only those fees, but also millions more in probate costs, with much of what’s saved going to fund ministries’ work.