Russell James: Quantitative Fundraising Research
You can stop relying on conventional wisdom passed on through webinars and conferences. There’s a plethora of quantitative research on how to optimize storytelling to get your best fundraising outcomes. What is social emotion, how do you evoke it and why should you? How much story detail is not enough or too much? Better to talk about individuals or groups? What does the research reveal to maximize Planned Giving fundraising commitments? Professor Russell James of Texas Tech University walks us through what the research shows.
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And welcome to Tony Martignetti nonprofit radio. Big nonprofit ideas for the other 95%. I’m your aptly named host and the pod father of your favorite abdominal podcast. Oh, I’m glad you’re with us. I’d be stricken with anaplasmosis if you ticked me off with the idea that you missed this week’s show. Here’s our associate producer, Kate with what’s coming? Hey, Tony, it’s quantitative fundraising research. You can stop relying on conventional wisdom passed on through webinars and conferences. There is a plethora of quantitative research on how to optimize storytelling to get your best fundraising outcomes. What is social emotion? How do you evoke it? And why should you, how much story detail is not enough or too much better to talk about individuals or groups? What does the research reveal to maximize planned giving fundraising commitments? Professor Russell James of Texas Tech University walks us through what the research shows on Tonys take two, Don Bon Jovi were sponsored by donor box, outdated donation forms blocking your supporters, generosity, donor box, fast, flexible and friendly fundraising forms for your nonprofit donor box.org. Here is quantitative fundraising research. It’s a genuine pleasure to welcome back. Russell James to nonprofit radio. He is a chaired professor in the Department of Personal Financial Planning at Texas Tech University. He directs the on campus and online graduate program in charitable financial planning A K A plan to giving. He has published research in more than 75 peer reviewed scientific journal and law review articles. Russell has a law degree. He’s the author of several books, including the storytelling fundraiser, The Epic Fundraiser, the Primal Fundraiser, the Socratic Fundraiser. And I don’t know where this title came from inside the Mind of the Bequest Donor and Visual Planned Giving. Uh Those are outliers and there’s a new book coming. We may talk about that. If he’s willing, Texas Tech University, you’ll find at TT u.edu and you’ll find Russell on linkedin. Welcome back, Russell. It’s good to see you. Thanks so much. Great to see you as well. Tony. Thank you. It’s been several years since you were on nonprofit radio. I regret that I regret that it’s a mistake. I’ll try not to uh make a second time. Um Would you like to say anything about your uh upcoming book or is it a complete, it’s a secret and we can’t talk about it. Uh So the upcoming book is called the Biblical Fundraiser, helping Christians enjoy their wealth and uh certainly taking AAA very specific perspective on that. Not something that I teach here at a state university, but something that is of interest to some folks So, uh, uh I’ll be happy to share that one as well. Uh The first of 2025 should be available. I’m sharing it with a few beta readers right now and, uh trying to get all the kinks worked out and I’m, I’m one of them. I haven’t done yet but, uh, but I will, am I too late? No, no, no, you OK. I thought not. Right. I, I’m, I’m not gonna be able to read the entire book, but I will, I will read some and I will give you my honest feedback to, uh, the biblical fundraiser which fits in line with your, most of your other, your other titles, the Storytelling Fundraiser, the Epic Fundraiser, et cetera. So the biblical fundraiser. All right. So we’re gonna like to talk about some, the research, the research, see what’s, what’s fantastic about having you is that this is not, well, this is kind of the way I learned it well, you know, the way we’ve always done it is, um, uh, you know, the way I’ve always done it, you know, is the way fundraisers will sometimes say. So we have empirical research. Uh and I often cite your research um in uh in my trainings. And so we, we wanna talk about the research today in uh use of use of language, some things to talk about topics, to talk about topics to steer clear of et cetera. Let’s start with empathy uh in, in storytelling. You, you’re uh you emphasize that this is really essential for people to get that motivation to give the empathy. Yeah, absolutely. So, you know, this is not a shock, right? The idea that uh our philanthropic or charitable impulses are going to involve uh empathy, I think it helps to understand a little bit about the processes behind making that happen. Because really our goal in this space is to evoke a clear image that will generate some kind of a social emotion like like empathy. Uh Now, if we’re gonna do that, I like to talk about the idea that what really helps is to make it specific, make it simple and of course, ultimately make it empathetic. So, so we do have to create this internal visualization to, to really trigger those kinds of social emotion if we don’t, uh it’s it II I like to put it this way um in order to get people to feel something, we, we’ve got to first help them to see something. And that means we’ve got to present that clear image. Of course, what they see ultimately must be empathetic. Otherwise they’re not going to be moved to do anything but oftentimes in our messaging, even that first part is where we trip up and you even have neuroimaging research to to to back up. But see this, this is empirical, this is not, this is not, well, I feel like this, you know, it has intuitive appeal So it’s just, you know, that’s what, that’s what we should do. You have neuroimaging research to back up a lot of what you just said about people seeing something and then feeling. Yeah. Absolutely. So this is an area where we see what I like to call triangulation. In other words, lots of experimental research, different people get uh exposed to different things and we see how they uh how they respond, how do they give or not give. But also some of the things that I do. So here at Texas Tech Neuroimaging Institute, we’ll stick people in brain scanners, have them make charitable decisions, volunteering decisions. Uh Even uh I I do a lot of work in plan giving. So we’ll have people do their estate planning while they’re in the brain scanner and ask them about including different charities and, and through that process, we learn about what does it look like in the brain when people decide to be veritable? And it turns out that one of the important components of that process is an internal visualization uh for those uh planned gifts, gifts and wills. It’s really about an autobiographical visualization that is people kind of taking an outside perspective on themselves. Uh But we see it in other research, even with smaller gifts, it’s it, it really needs to start with creating that imagery or vision that is going to then lead to the social emotion. And that doesn’t mean that the communication must itself be visual although that’s fine and can be helpful. It it more means that a person can internally visualize what the impact of their gift is going to be. So I I’m I’m dying to know what this brain scanner device looks like because most people who are not, who are most people who are writing charitable checks, you know, do not have a brain image scanner, you know, in their home. So, so how do you uh you know, you’re trying to recreate the giving experience as best you can in a, an experiential, I mean, experimental, you know, research setting. What does this look like? Is this a room that people walk into? And the room is equipped with image imaging devices or are they, you know, like a little bell code or what are they, what are they in while they’re research subjects? Exactly. So this is exactly the sort of thing you would walk into at a high end hospital. This is, it’s called, it’s an MRI machine. Uh And the person physically uh is laying on a table goes into the MRI machine and then the way it works, we actually have their head in the center of the MRI machine and they’re looking at uh what is actually a mirror but that mirror projects uh what we can put on a screen. And so anything you can see on a computer screen you can see in that and then uh uh they have uh a different response buttons so they can make choices and you set it up to make it as real world as possible. So for example, if they were making as real world as possible, putting aside the fact that they’re laying on the, laying down their supine in an MRI scanner, set that aside. It’s as real as setting that aside. And part of what we do is we make sure that they’re used to the environment. We have them. Um Yeah, and answer questions on various other things. So it, you know, isn’t like strange for them by the time we’re getting to the things we are interested in. Um And so how do we make it realistic? Well, with, with small dollar decisions, we make it real money, right? We make it like this, they, you, you, this is an amount of money that you’re getting paid. You can choose to share some of it because you, you get paid at the end of the process or you don’t have to share some of it. Uh Then with the estate planning, part of it is to say, hey, we’re gonna mail to you legally valid last will and test no charge to you. You just got to answer the questions while you’re in the the brain scanner. So, so those are some examples of how we try to make it real decisions. Um As we are scanning a variety of these uh uh these processes and the thing I like to emphasize there is that what we see is triangulation, meaning that we’re not the results that we’re seeing in the brain scanner are connecting with, they’re triangulating with what we’re seeing from experimental research. Sometimes even what we’re seeing from data uh in uh in uh large surveys, that sort of thing. And that’s when we start to get more confident about the answer. Say no, no, this is, this is true. You can look at it through widely different methodologies and uh you come up with the same answer, that’s where we get more confidence about those answers. I see, right? So each, each of the three legs of the triangle is supporting the other and that, that leads you to the most uh most confident conclusions, right? I can give you an example uh of, of that uh in uh in plan giving if you’d like. But uh so, so just to kind of give a short story, don’t tease us. And then, and then we go on to a different subject. I do have a question for you about the brain scan. Uh But give the example that you’re thinking of. So, uh there was a really cool in depth qualitative research of uh this was done by Dr Claire Raley in the UK, of people who had included a gift to charity in their wills asking them about what motivated them to do. So why did they pick those organizations and one of the ultimate conclusions of that was, it was really about the donor’s life story, right? It was about, it wasn’t so much. The next project the charity was doing, it was about connection to the life story. Then when we scan that same type of decision making process in the brain scanner, we see that what predicts including a particular charity is a dramatic ramp up in uh brain activation in brain areas that you might call visualized autobiography. These are regions of the brain that uh that tend to activate when people are mentally traveling back in time or thinking back across their life. Uh So they’re internally visualizing while taking an outside perspective on themselves. So then we take both of those things and we use it in an experiment where we were testing uh about 30 different ways to phrase the charitable gift in a will uh and trying to come up with what are people most interested in doing in the phrasing. And it turns out that um we could really increase people’s interest. We, we start with our sort of best base performing phrase, which is to describe it as a gift and a will rather than some of the more technical terms we could use. But we could ramp that up if we ask them about their interest in a gift in AAA charitable gift and a will to support causes that have been important in your life. And in fact, when we add that phrase on to almost any plan, giving description to support causes that uh to support causes that have been important in your life. It really ramps up people’s interest in making those kinds of gifts. Well, what we, what we’re doing is we’re trying to trigger, by the way, we’re phrasing the question, a life review process because look, nobody wants to be that guy who says no causes have been important. My life, right? It makes you think about your life review, connections, your life story, connections to different causes. And we know from the brain scanner, that’s what triggers these decisions. So that’s an example where we get all three different kinds of research, in depth qualitative brain scanning research and experimental uh uh testing. And uh we can come up with something that’s functionally useful. It’s time for a break. Imagine a fundraising partner that not only helps you raise more money but also supports you in retaining your donors. A partner helps you raise funds both online and on location. So you can grow your impact faster. That’s donor box, a comprehensive suite of tools, services and resources that gives fundraisers just like you a custom solution to tackle your unique challenges, helping you achieve the growth and sustainability, your organization needs, helping you help others visit donor box.org to learn more. Now, back to quantitative fundraising research. I I gotta pull on this thread even though it’s a digression. I still gotta I gotta pull a little more. Is there, do we know anything about age dependency? So if you’re, if you’re, if reflecting back on the causes that have been important to you in your life is, is a, a valuable phrase to add the more years you have to reflect back on. So if you’re 60 are you more likely to be moved by that phrase than if you’re 30? So we didn’t find an age difference in that specific phrase, but we found a related age difference. So one of the things that can really ramp up interest in uh a gift and a will uh is if we ask people about, do you have uh a family member who would have appreciated for a deceased family member or would appreciate your support of this kind of a cause? And if so tell us about their connection to the cause and then if you match that with the opportunity to make a uh a gift and a will in honor of or in memory of uh that, that loved one, that process actually dr can dramatically ramp up interest in leaving a bequest gift to an organization. Now, two things about that one, that process is significantly more impactful for older adults. And it’s not so much that when they have a family member connection, especially with a deceased family member that the uh that the hit or the increase in interest is so much greater. It’s that as people age, they’re more likely to have deceased family members who um they have these connections with. And it turns out that deceased family members more powerful connection than living family members. Uh And it, it tends to be um ceased ascendants, uh not descendants. Uh And in particular, female ascendants uh tend to drive these uh these kinds of things. So, so that’s an example where we have an intervention that is age dependent For exactly the same reason that you mentioned uh that they’re more likely to have those kinds of connections, have those folks who have died in their lives. So it sounds like mother and grandmother. They, they, they would do, they would do much better than uh son. Yeah. Yeah, exactly. Friends don’t work. Uh Descendants don’t work. But ascendant uh uh grandmother number one, then aunt, then mother uh father was statistically insignificant, father, fatherhood, statistically insignificant mother, less significant than aunt or grandmother. Yeah. As the more you move up then and part of it is just that we don’t leave money to those people so we can use a gift because we, we wouldn’t give it directly to them. OK. All right. Let’s go back uh back to where we were. I, I asked you to, I, no, it’s my fault for uh pursuing the digression. But uh all right. So now back to the brain scanning. Uh is there an MD in the room with you? I mean, in case the person needs some anesthesia or something or they freak out in the MRI or have you preceded people who are? Ok, in MRI machines. So, um we have, uh, so the research that I’m doing is just part of the Texas Tech neuroimaging Institute. And of course, I’ll have a co-author on all of these that, uh that has worked with this and so sort of pre-existing systems set up for those, uh, those sorts of things. But yeah, we’ve had some interesting things and, and in fact, one of the things that we do, uh, just for such an event, uh, because we schedule people for these, you know, 45 minute sessions and all of that. And we, we pay for the time, which is expensive time on the machine is I’ll hire grad students to just sit there and do homework all day because if somebody freaks out in the machine presses the button says, I don’t, you know, I can’t do this, I’m out. We need to have somebody that is, uh, that is going in there as well. So that does happen from time to time. Is it true that charitable giving activates the same centers of the brain as, uh, eating chocolate or is that the hypothalamus or the, the pleasure centers and eating chocolate? I always see the two, not that often, but through the years, I’ve seen the two analogize charitable giving and eating chocolate, but activates a pleasure charitable giving activates the same pleasure center. Uh, uh, is that, is that true or is that a Wives Tale? Well, you know, it’s true to the extent that, um, charitable giving is enjoyable. Uh, and so we do see activation in, in the brain and it turns out there’s some cool research that shows charitable giving is really enjoyable. But if they’re doing the exact same thing without being able to choose it, so it’s taxation rather than charitable giving, that turns out to be not so much fun. I, I know shocking result, right? Uh But uh uh so it, it, it, it does activate these reward centers. Um So, you know, I, I guess a slightly more accurate way to think of it is that it activates the reward center rather than the uh the, the same reward center, you know, in the sense of, oh, there’s one, there’s one part of the brain that only reacts to chocolate and giving, right? It’s like, no, this is the more generic network that’s used that is uh indicating a uh a reward uh in, in the brain activates the reward center. Is it the hypothalamus or do I have that wrong? Uh So that’s not what we’re seeing in a lot of our more ventral striatum and some of some of the other um uh uh areas that, that engage. But to be honest with you, most of these things like reward, uh they uh occur through a network. And so you’ll actually get activations that simul activations in multiple areas. Uh And uh and so there are different pieces that, that uh that are involved. So there tends to be networks rather than just one location does, does one thing. Although certainly if uh if there’s damage or interference to one location in a network, it can mess up the whole thing. OK. Cool. Thank you. Alright. So refining my uh my thinking through the years. OK. And my my analogizing. All right. So it’s the reward center actively the reward center. Um So, all right, let’s let’s drill down to some of the details of your years of research. Um and others, you cite lots of other people in in some of your, some of your trainings um like details of individuals in details of individuals are better than generic type individuals in in, in storytelling. Yeah, you know, so this is something that comes back to that notion that um we’ve got to create an image and it needs to be an empathetic image. Now, the challenge is that oftentimes the underlying issue we’re working with has real complexity in that issue and that complexity is true, but it’s not motivational. And so whenever there is AAA um a randomly assigned experiment between a simple story involving a single person, um this is known as the uh identifiable victim effect that people are going to give more to that and to the extent that you make that story more complex people will give less. So, so real simple example. Um if uh in one experiment where the total cost to save uh one child or eight Children was exactly the same with the story of one child, 90% of people donated for that. But if you told the story with eight Children, only 58% donated to it, and we kind of see this again and again whenever we make the story more complicated, um and it’s harder to easily visualize, uh then we don’t get that social emotional response. And when we tamp down that social emotional response, then we tend not to get given. Now, this comes up all the time. Whenever people start leading with numbers, you know, this idea of, let’s talk about, you know, the impact in terms of uh the hundreds or the thousands or the tens of thousands. And, you know, from an accounting perspective, we’d love that it sounds like impact, but that is not visiable. And so it turns out that when we lead with numbers, uh uh that is not going to engage the social emotional regions of the brain. It lets the brain know, hey, this is a math problem and we’re going to engage those math error, detecting part of the brains, the the sort of accountant part of the brains. And uh and that is not going to uh trigger the kind of social emotion that that is necessary to begin the philanthropic process. Now, this does not mean don’t ever talk about numbers, it means don’t start with numbers. You’ve got to start with that motivational image of impact. And then for some people, they’ll be interested in numbers. And so after you have kind of that motivation going of the visual liable impact, then you can tamp down their uh their error detection. Uh mathematics side by providing sufficient information or at least access to that information, don’t push it on them because uh many people uh o only need a limit, go too far. If you go too far, then you’re starting to reemphasize the mathematical again. And it’s gonna start to blunt the visualize the visual visual will get exhausting and you know. Right. So, so make it accessible and available on the data because you know, you’ll get an engineer or somebody who just loves diving into that, that’s fine. But don’t ever lead with that. We wanna, you think of it this way? Um The, the that social emotional imagery, that’s the engine in the kind of philanthropy decision making car. Whereas the math and the numbers and the air detection, that’s the brake on the car. So you do for some people have to get them to move their foot off the brake to, to, you know, at some point, right. But the point is if you haven’t started the engine, you spend all day getting that foot off the brake, not gonna go anywhere. People will not and say, oh yes, I understand. But they’re not gonna give, they’re not gonna actually do something. Whereas if you start the engine first that oh this is exciting. I can visualize it. I can see it iii I want to make this happen then it matters whether you get him to take the foot off the brake and even more. So when you add identity to the to the individual that you’re that you’re leading the story with. So, right? Like if you had name age, these those factors are will increase the giving over just, you know, just it’s just Sarah. Exactly. So anytime we can add or even worse, an eight year old, right? So anytime we can add a few and I emphasize few details that helps me create an image of the impact that I’m going to have that’s going to increase the likelihood of uh making the gift. Now, the reason I emphasize few is we find that if you just keep going and adding 89, 10 details, now you’re making it too complex. Now, uh the social emotional reaction tends to go down, it tends to get more exhausting. And so that’s why it’s that notion of you wanna have this clear, simple image that evokes the social emotional response. So what belongs like a name age? Uh I don’t know location, maybe the the town that they’re in if let’s say it’s a disaster relief or something, name age and city is that that’s not going too far. Yeah. Yeah. So, you know, in general, for example, a lot of the tests are done with uh you know, let’s say uh you just get the uh description without the name. Adding a name helps if you get the name, but you can’t see the person being able to see the person or an image of the person. Uh that helps. Um So adding a name and picture uh that is generally going to uh going to be uh uh very positive and it’s just like other good storytelling, right? If you start reading a story and it says introducing character number one and then you have like five paragraphs of details on them. Like we don’t want to read that story, right? But if you know, as we learn about the person and during the course of this, the story and what’s happening and the impact of detail here or there helps make it more emotional or easy to visualize. Then that’s helpful for the story. It’s time for Tony’s take two. Thank you, Kate. I have to say how much I admire Jon Bon Jovi. Last week, he was filming a music video on a bridge in Nashville. He saw a woman on the wrong side of the bridge railing, she was hanging on with her arms and over the water and he went up to her with one of his assistants and he, he just kind of got close and the only video we have is a surveillance video. There’s no audio to it. Uh just a surveillance video from the bridge. You see, he gets close enough, he talks with her a little bit. He gets closer and helps her back onto the right side of the railing and he gives her a big hug and they walk off together and he’s congratulated uh later on in uh social channels, you know, he’s congratulated and thanked by the police and it’s just a very heartwarming story AAA lovely story of humanity. Um Actually in the video before he goes up to the woman and starts chatting, you do see some people walking past her and they look, one person looks back but they don’t do anything, they just keep walking. Uh So, you know, a celebrity multi 100 millionaire maintains his humanity goes and helps another human being who’s uh suffering a crisis act obviously and helps her off the bridge literally. So just a very sweet story, Jon Bon Jovi. Thank you. I would say I was almost gonna say congratulations, but just thank you. Thats Tonys take two Kate. Yeah, I didn’t hear of this until you told me and now that I saw like the video and I bet she needed that hug so bad from someone and her like him giving that to her like that he just saved her. He did, he gets to live another day years from now. I don’t know how old she was, how young she was, but she still had a whole life ahead of her and he just saved that life. Heartwarming. We’ve got Buku, but loads more time. Here’s the rest of quantitative fundraising research with Professor Russell James. You also have really interesting research on, on groups if, if it’s, if it’s a group of eight and they seem individual that uh is less motivating, I guess, less social emotion than a group of eight that are cohesive, uh a cohesive group, right? And so this comes back to being able to, to envision a single character. OK. So for example, if I’ve got a story of the uh you know, the one child versus the eight, the eight is harder to visualize too much going on there. The one is uh is uh going to outperform. But if that eight or say five in one of the experiments, it was actually six Children in one of the experiments if they were described as siblings as part of a family, well then that negative effect went away because now I’m kind of dealing with one character in the sense of one group. And we see this in like really weird ways. Uh also like for example, if you’re giving to a butterfly sanctuary and the butterflies appear to uh across the video screen all moving in unison as one unified group versus they do what butterflies always do, which is to just be scattered and bouncing around people give more when it’s that group image. Uh And so this is kind of this consistent result. There’s another study that showed the same thing with gazelles. And you know, the idea is that what is an easier character to empathize with? We can’t really empathize with a dozen or 20 different characters at once. But if that 20 or 50 characters becomes a group, then we say, oh, this is a character I can identify with this group as a car character. And that makes for a better story, meaning that easier to visualize, easier to have empathy for and it generates uh more uh likelihood of giving. What about the the cohesive group versus an individual? The individual story does the individual still do better in terms of giving outcomes than the cohesive group, right? Yeah. So uh so identifiable victim effect to use the technical term always gonna outperform. Um then if it’s a bunch of uh you know, uh recipients, individuals, animals, whatever it is, then that’s gonna perform worse. But if we describe them as a cohesive group with a specific, you know, kind of uh story to that group, then that’s gonna outperform the sort of uh scattered uh you know, the numbers story I I, in other words, we’re, we’re trying to um reduce the negative impact from talking about numbers by just talking about one group. And this is, you know, this especially if it’s a family that’s a cohesive group or um you know a tribe or a uh a a community whatever that makes it. Ok. Now we’re back to the story about one character in essence. Ok. But the one identifiable victim always outperforms. Yeah. In these in these small gift decisions it does. Yeah, that’s what we’re talking about. Alright. Um Are there other layers to the research? I mean I I wanna get to talking about tax deductions versus tax savings but before we get there, uh are there other layers to the research that you wanna, you wanna share with the listeners? You know, I I think uh if I could share just one thing uh in this, I’m borrowing it from actually a script consultant uh uh Michael Ha uh who uh you know, works with not only scriptwriters but even CEO S on what their message is and he always says number one problem very simply their stories are way too complicated and this is the constant challenge in the fundraising space is how do we create a message that is an appropriate representation of the scenario? Uh So we want it to be accurate but complexity kills empathy, it kills giving. And so, so that’s always the the notion of how do we have that story be something that is uh simple, uh straightforward and uh it evokes that uh that emotion. So again, the the reason this is such a big challenge is if you let non fundraising people, administrators get involved with uh writing your fundraising copy it, they’re gonna kill it because they’re gonna make it more complex because they live in a world of complexity and they want to sort of force the donors to they need to understand all of this like no, no no that that’s we can put that, put that in the annual report. Exactly. Exactly. Alright. Alright. Um so let’s talk about including some of the mathematics uh in in terms of talking about tax deductions or tax savings, different types of gifts. Now I know I think we’re moving away from the small dollar gifts, we’re moving to the more structured, you know, planned gift like gift annuities, uh maybe stock, you know, stock gifts as well but but that’s ok, you know we’ve we’ve spent a good amount of time on the small dollar giving decisions. Um let’s go to the the the yeah the I mean the more the more nuanced gifts and and talk about tax tax deductions, tax savings. What what’s the research there? Yeah, so one of the things to keep in mind that oftentimes gets confused especially in the fundraising space is that the tax benefits are not about motivating the gift, they’re about reducing the cost of the gift, making it smarter making it more attractive. So oftentimes fundraisers um uh they they uh get bad information uh and and uh it it sort of has legs because it’s something that they sort of want to believe. Uh, but the bad information is that, uh, tax benefits don’t matter. And since they don’t matter, hey, you don’t have to learn about it. Right. So that’s a lovely message for fundraisers makes your life easier. It’s just not true. And, uh, so let me explain, uh, what I mean by that, it’s not true. Like empirically, uh, we can definitely see nationally that, uh, tax deductions make a difference. And one of the ways statistically we can identify this is that although people’s incomes go up at a dollar at a time, their tax benefits, which are based upon the income bracket, tax bracket, they’re in, don’t go up a dollar at a time. They have these hard break points that different places. So we can separate those two things and we can see where, oh, that tax benefit went way up here and the, the behavior, uh we, we see that as well. Of course, there’s also different uh things that we can compare year over year. Um We can also do this experimentally, uh just asking people about interest in, uh for example, in, in one of our studies, we compared uh asking people about, are you interested in learning about making a gift or are you interested in making a gift of stocks or bonds to charity uh versus are you interested in avoiding uh capital gains tax by making a gift of stocks or bonds to charity? Uh, and about half fold more people were interested in, in the, in the second thing. Uh, so again, it’s important to understand that what sometimes the bad information comes from this approach where you’ll have an organization or a consulting firm says, hey, we want to learn why people give and so they’ll, you know, send out surveys and say, um, here’s different reasons people give, which of them apply to you and some of them will be, you know, because I want to change the world because of my values. That’s how it’s brought up because, you know, the impact I want to make and then one of the options will be uh because I want tax benefits and people don’t choose it. No, nobody chooses that because you look, you feel like you’re a petty person, kind of, what kind of altruist am I if I’m giving for the, for the petty pecuniary reason, right? And this is in fact a very common issue in social science research and something that we’re well aware of and it’s why we don’t test things in that way. You know, if you ask people for their motivations, you’ll get the socially approved motivations. And so that’s why we test them in different ways, you know, randomly assigning them to different descriptions and notice what happens to the impact and, or looking at the uh national data. Uh and uh and all of that, so all to say that it makes an impact. It’s not the motivation but it does lower cost and price matters. I mean, look, economics, 101 price matters and whether you’re talking about smoking cigarettes or, or, uh, making gifts, price matters. It’s not the motivation but it does matter. And, and so it is helpful to, uh, to, uh mention these things. Um, can we, can I reference your graph, uh, that you, you rely on sometimes when you’ve got motivation and cost and as cost goes down and motivation goes up where the two cross that’s a giving decision. So if we can bring the cost down, then maybe a little less motivation is required. Yeah. Oh, you know, and the other way to think of it is, you know, look Tony, you could get me intensely motivated to make a $10 million gift to Texas Tech University to build a new library building. II I don’t have it. So, you know, the cost is too much, right? So you’re gonna have to lower that cost in order for me to participate. Uh This is also true, a kind of a smaller scale where uh we see that that that cost does uh does matter. And so there’s another interesting thing about that, that it’s not just about uh cost mattering, but it’s also about the way that we frame that benefit that is coming in. So for example, and this is real consistent across a lot of uh uh economic experiments and that is that if you describe the benefit as a matching where OK, you’re gonna give a dollar, then this, this other organization is gonna, you know, give 50 cents or a dollar or whatever. That is more motivational than if we describe the economically identical result as a rebate or a refund. In other words, will you give $2 and then they’ll give you a dollar back now to an economist or an accountant? Tho those are identical, right? It, the net cost is the same in both cases, the, the net to the charity is the same in both both cases, but the story is different. So if I can use terms that describe it in a matching framework, which is to say, well, you put this in and then it gets matched and that increases your impact. Well, that’s a very charitable story. And it’s also me not only being philanthropic, but I’m being uh intelligently philanthropic, I’m making an even bigger impact. Whereas if you frame it as a refund or a rebate, well, I’m a little philanthropic, but I’m also getting something out of the deal too. And so I, you know, so it kind of messes it up. Now. You could look at that and say, well, everybody does matching gifts, nobody does refunds on gifts. Like why do we care? Well, we care because the tax system is set up as a refund system, essentially a rebate system because you give and then o on your, your tax return, you know, you get this uh this uh rebate back or, or this tax benefit back. So we can’t change the system, but we can change the language that we use to describe those tax benefits. We’re not going to describe them as, hey, you make a gift and here’s the, you know, here’s the killing you can make on your tax return. This is a, a AAA great benefit to you. We want to describe it more in matching terms that your gift can become more powerful when uh you get the government to kick in their share uh through these kinds of uh of benefits. And so that’s how we use that kind of experimental research. All right, it’s fascinating. Um What about the uh what about simple gifts and wills where there, there isn’t a tax implication uh for, for the vast majority of donors. I mean, the, the annual estate, the estate tax exclusion, not the annual, the estate tax exclusion. Now is what $13.6 million I think per, per person to double for a married couple, double for married. All right. So 99.9%. So, you know, let’s exclude the uh the 1/10 of 1% that is gonna benefit from that. Uh So, so there isn’t a tax implication to making a charitable gift by will Simple charitable bequest. What do you have advice about messaging that? Yeah, so uh, so a couple of different things, uh, first, um, I will, uh, again coming from a Department of Financial Planning, uh, if we want to talk about taxes, what I’m gonna do is start out the conversation by saying, um, that, uh, you know, any of that money in your IRA or 401k, any of that that goes to your family, they’re gonna have to pay income taxes on that when they take it out. And in fact, the new rules, they got to take it out even faster than before, but any of that, that you name to go to our organization, no income taxes on any of that. Now, I mentioned that because as a financial planner, the very first dollars we want to send to charity in the estate is the qualified plan money that is the Ira 401k. Um And so they, so they don’t have estate tax issues in their estate planning, but they do have income tax issues in their estate planning. So, so that can be a way to, to get into that convert. But it is interesting how the gift and a will is fundamentally a different decision than the uh current giving uh, decision. Uh And we see that the, that the behavior itself is different as well. Now, part of the reason that it’s different is that it’s about planning for your own death and most people, um, that’s not their favorite subject. There’s a bit of avoidance that goes on with that. Um So, so there’s a couple of different things that we see here. One is what’s the most powerful way to get in a will. Honestly, it’s to just be top of the mind at the right time when some other life event happens and people are going through that process and by top of the mind, I mean, always just sharing stories about, oh yeah, people like us include gifts and wills uh all the time that uh benefit the organization and reflect their life story. And so it’s just kind of this constant communication because one thing we see from some pretty cool experiments is that uh this charitable giving decision in the will is relatively fluid like uh uh so for example, there was one experiment, 1000 people went through the normal wheel planning process. Uh didn’t have any specific question about a gift to charity. 4.9% of those people included a gift to charity. Another 1000 people had this same questions. But one extra question, would you like to leave anything to charity? 10.3% of those people included a gift to charity. So you more than double it just by being top of the mind, right? And so that is kind of the the the first step. Now there’s a second step involved if you want to get to the really major gifts or the substantial kind of uh uh inherit sentences and that deals with this second stage response to being reminded that they, we’re going to pass away. First stage response is just avoidance. Like I don’t really want to deal with that. If you get past that, the second stage response is technically called the pursuit of symbolic immortality. This is the notion that OK, I’m gonna disappear, but some impact of mine will continue you on after I’m gone. And so if a charity can provide an opportunity for a gift that reflects that person’s life story, then they’ll be included in the plan. If they can provide an opportunity that also provides some permanence or sense of permanence, that’s when those major gifts come in. Uh So, for example, uh whether that’s an endowment uh uh for a particular part of the operations, you know, at the universities, we have professorships and scholarships or in financial planning, private family foundations or uh some of the advice fund substitutes for that. In fact, believe it or not, Tony, if we go back to 2007, when the exemption levels were down to $5 million so we were able to see more of that data. This is a number that’s going to blow your mind in 2007. Um Actually a a uh when we look at the total charitable bequest giving that’s taking place 78% of the dollars for a state’s 5 million and above went to private family foundations. Now, that means only 22% are going to actual public charities. Psychologically, that’s important because we know that the private family foundation is kind of the ultimate expression of symbolic immortality. It’s named for the donor or the donor’s family. It’s legally required to follow his rules or her rules of values forever. And it’s intended to live, you know, forever uh permanently to continue making that impact indefinitely. Uh That uh even after the donor is gone. And so why that is important is to understand that any time we can replicate some piece of that private foundation experience for our donors, that’s what’s going to drive these major life investment gifts. And honestly, that, that’s actually what we see in any uh big giving. Uh not just uh the estate giving is that it will come with instructions, it is the donor’s instructions that make that gift motivational. Uh And so the, the uh study that came out about 18 months ago from case, looking at the largest gifts uh that were received from all different levels of colleges and universities, when it analyzed those largest gifts, only 14% of those gifts included even a single dollar that was unrestricted. You know, the bulk of them went for endowments, some went for buildings. We’ve, it is that sense of symbolic permanence, endowments, buildings. There’s no, there’s no, there’s no, there’s no more permanent than a building. So it’s something that reflects my values and life story that lives on beyond me. And so, I mean, fundraisers would say perpetuity, you, you, you’re the researcher and you’re saying, you know, symbolic permanence, but we would say perpetuity, maybe not in talking to donors, but in trying to uh you know, just internally trying to encourage these types of gifts that, that uh the donors values will live on. It’s interesting, you don’t, you don’t use the word legacy. So yeah, go ahead. It doesn’t matter what I because you’re the researcher. So we tested a bunch of these phrases about what, what works best. So for example, do people want to, are they interested in making a gift in a will? Do they want to read about will planning? Are they interested in making a legacy gift? They don’t want to read about legacy planning. Are they interested in a state gift? They want to read about estate planning. It turns turns out the most attractive term is simply gift in a will. Uh We will planning. Why is that some qualitative research unpacked this a bit. Uh And that is for a lot of people when we start using terms like estate or legacy, they feel like those terms don’t apply to them. They’re a bit too grand, you know. Oh, in a state that’s like for the people on Downton Abbey who go riding their ponies across the vale in the morning, but it doesn’t really apply to me. But oh, a gift and a will. Yeah, everybody needs a will. And so there is that barrier with some of these terms that the legacy is absolutely the right idea, but sometimes that the term itself can be. Um, it, it, it’s not quite as attractive. Ok, I, I can say that my anecdotal experience over 27 years doing planned giving is identical to that. Uh uh I, I’ve turned in my early years, I saw people, you know, they, they just would bristle at the idea of a legacy that, that, that’s for the, the Gates and the Bloombergs. Uh You know, now it’s for the, for the Taylor Swifts and the Elon Musk’s uh right. It’s, I don’t have a legacy, I mean, and we all do have a legacy and you’re making that point, you’re saying the concept is right? But the phrase um so I’ve, yeah. So for, for a long time, I’ve been training that that’s not the best way to talk to people about their legacy when you’re talking to folks of normal modest means, just talking about, you know, longevity and the, the importance of your mission in the community, et cetera, but not their legacy. And to agree with that. And to agree with that, e even more, one of the things we find is that you, you don’t actually have to be selling a permit its structure. You can just use permanent language to describe the impact of your organization. So this was a really cool experiment where uh people were uh uh at the end of the experiment, they had an opportunity to make a gift. Uh And it was always to the same organization in uh poverty Relief Organization. In one case, it was described as uh uh making an immediate impact on uh on the lives of people. And in the other, it was described something along the lines of making a permanent impact that will benefit people in the future. Well, it turns out that for just the normal group that wasn’t reminded of their death wasn’t doing estate planning. It was better to talk about the immediate impact. But for the group that had first been reminded of their own mortality, which of course happens in the estate planning process for that group. Uh That immediate impact message did not work at all. People did not donate to that. Uh They donate very little to that, but they actually donated three times as much if you describe the organization as making lasting improvements that would benefit people in the future. And that just sort of psychologically shows the attraction in these death related contexts of permanence. We found the same thing when we were trying to figure out how do you get somebody to make a second memorial gift in honor of a deceased loved one. You know, the first one happens at the funeral and like, ok, I’m making a gift to the organization, but the organization never gets that second gift. So what we found we tested a bunch of different messages, the most powerful message to increase the likelihood and the size of a second gift is to have an opportunity that if we hit this goal for total giving in honor of this person, the fund becomes a permanent fund. So again, that same notion of anything death related, if we can offer permanence, that is super attractive, interesting that has, that has a lot of implications for on your health care specifically where there are so many gifts in honor uh on hospice, right? Someone, someone dies in a hospice facility. And the family says, you know, gifts to in lieu of flowers, please make gifts to the hospice and people do it, but they do it, they do it once and and you never hear from those donors again. So there’s a way uh it’s not exclusive to health care, but that’s the first thing that comes to mind because there’s a death often in health care and, and uh related related work. So, all right, bringing those folks back for a second time with uh with permanence. Again, there’s that there’s that implied uh I implied uh what did you call it? No. So the pursuit is symbolic immortality, symbolic immortality. That’s right. We will catch up. And in fact, if you want to make it super powerful, then you communicate for the second gift near the anniversary of the person they made uh the anniversary of the passing of the person that they made the gift in honor of because that really elicits that kind of mortality reminder very strongly. And then that causes the attraction to the permanent outcome. Interesting. All right, this is, this is bordering on manipulative because you want to, oh my God, it’s been a year since she died. I can’t believe it’s been a year now. So you’re saying, you know, capitalize on the uh I’ll avoid using the word, I’ll avoid using the word exploit the anniversary. Yeah. So we can think of it in the sense of we’re providing this positive experience. And so when is that positive experience going to be of most interest? Well, it’s when that sense of impermanence is the strongest, that sense of loss, that is the strongest, that’s when this particular uh you know, experience or product that we’re offering, it really hits the spot when it becomes of, of most interest. I know the cynic would say you’re manipulating people, you’re taking advantage. But this is fun. It’s, it’s, I’m not that cynic. I was just, I was musing a little bit. All right. But yeah, really, you know, this is, uh it is quite valuable. Um not only the groundbreaking parts that are new but the uh unwinding of the, the old saws that are told, you know, get perpetuated at conferences. And uh you know, it’s, it’s, it’s detrimental, you know, it’s, I mean, and I i it’s it’s valuable for folks to know there is science. It’s, it’s not all, it’s not all, uh, tales from the past and, and anecdotes. All right. All right. I’d like to leave it there if that’s ok. That sounds great. Is there anything itching? Is there anything that like the tip of your tongue that we got close to? But I didn’t know enough to ask about? No, I appreciate the opportunity to share. It’s always fun to have these conversations. My pleasure. Absolutely. Russell James, chaired professor in the Department of Personal Financial Planning at Texas Tech University. You’ll find Russell on linkedin. Thank you for, for debunking myths for breaking new ground for the quantitative evaluation of uh of, of fundraising and, and, and what, what it takes for successful outcomes. And Tony, let me say I share all my stuff for free. If somebody connects with me on linkedin, I send them links to all my books for free videos, slide sets, academic journal articles, all of that. Um Some of that’s on my website, encourage generosity.com. Uh but share all my stuff for free. It doesn’t do any good. If it sits on the shelf here at the university, it needs to get out to the people that are actually making a difference in the world. All right, encourage generosity.com. That’s me. Thank you very much Russell. Real pleasure. Thank you. Next week, Amy sample ward returns for another discussion on artificial intelligence. If you missed any part of this week’s show, I beseech you find it at Tony martignetti.com were sponsored by donor box. Outdated donation forms blocking your supporters, generosity. 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