Ops Insights #023 Recurring Gift vs. Pledge
September 22, 2023 | Read Time: 3 minutes | Written by Jenny Kleintop
Happy Friday, A big round of applause for you being here! It’s a worthwhile endeavor as you continue to build, grow, and accelerate your expertise. I appreciate you tuning in, and I am sensitive to your limited time. While you are here, we’ll focus on practical tips each week so you can grab one takeaway and move on to the other things you have lined up for the day. Let’s dive in.
Since it’s been coming up lately, we are covering the differences between recurring gifts and pledges. A recurring gift/donation is different from a pledge, and your CRM should be able to handle both.
A recurring gift does not have an end date. Sally says she will donate $50 a month, meaning no end date until Sally says stop. What you want to watch out for is when the donor’s credit card is due to expire. There are systems now that automatically check for these, so you may want to look into that. Regarding counting as fundraising dollars, you typically count only the recurring gift payments. In this case, you would count $50 each month toward fundraising dollars.
A pledge has an end date. Ian says he will donate $100 a month for a total of $1,000. You would enter it into your CRM database as a $1,000 pledge that has $100 installment payments each month until $1,000 has been reached. Regarding counting as fundraising dollars, you typically count the pledge. In this case, you would count $1,000 when the pledge is made toward fundraising dollars.
The Stats
According to the National Center for Charitable Statistics, “45% of charitable donors worldwide are enrolled in a monthly giving program. That’s a pretty huge percentage of people willing to take on a subscription to give money to charity on a schedule.”
As you continue looking for ways to increase fundraising dollars while having efficiency, I highly recommend doing recurring gifts. It’s gained lots of traction over the last few years, making renewing donors automatic.
Take Action
Do you have a recurring gift program in place? If not, it’s definitely worth a try. Here are the steps you can take to get started:
Reach out to your CRM vendor to ensure there is functionality to handle recurring gifts.
Ensure your philanthropy operations team has a workflow in place to handle recurring gifts.
Advertise that you accept recurring gifts on your website and in the materials you send out.
Tell stories on how recurring gifts help and make a meaningful difference.
Thank donors often. Just because they are recurring donors doesn’t mean you shouldn’t steward them.
Bonus tip: Once you get a recurring gift program in place, thank, thank, and thank. Then look to ask these donors for a Planned Gift.
Looking forward to hearing how it goes. You’ve got this!
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