Extended pledges

Sheila Wortham

What is best practice when donor request to extend pledge for addional year while increasing the actual pledge?  My organization holds an annual event in which they encourage donor to pledge $1,000 per year for 5 years.  There are donors who have at least 4 open pledges from year to year.  I'm new to the company and cannot understand why the company allows for so many open pledges per donor.  I suggestion increasing the gift & split donation due to the appeal type.   My boss suggest creating another pledge for this fiscal year due to the appeal.  Our funds # rolls over each year but appeal changes year to year.

JoAnn Strommen

If a donor is pledging $1,000 per year for 5 years we would enter one pledge with annual installments for each year. Then if they increase their pledge to the same fund/campaign we would do a gift adjustment to increase the amount and make any needed changes to the payment schedule. Split gifts to different funds IMO do not work well - various reporting problems and RE wants to automatically apply a payment to all the funds. Don't know about appeals. Hopefully another user with experience on that side can let you know if there are problems with split appeal gifts (or search forum for past posts about split gifts).


If they are making a gift in 2017, wouldn't it all be under appeal 2017.  Don't see that putting part of the pledge under appeal 2020 would be accurate - at least not how we enter gifts.

Christine Cooke 2

Sheila Sheila:

What is best practice when donor request to extend pledge for addional year while increasing the actual pledge?  My organization holds an annual event in which they encourage donor to pledge $1,000 per year for 5 years.  There are donors who have at least 4 open pledges from year to year.  I'm new to the company and cannot understand why the company allows for so many open pledges per donor.  I suggestion increasing the gift & split donation due to the appeal type.   My boss suggest creating another pledge for this fiscal year due to the appeal.  Our funds # rolls over each year but appeal changes year to year.

I personally have never seen an organization that has donors carrying at the most two pledges simultaneously -- and in that case it's because they have a multi-year pledge to two different funds (maybe three if the third is short term - will be paid off in the same FY it was made, like i.e. event support), namely the Annual Fund or some other Annual Giving related fund and a Capital Improvement Fund.  If you want any sort of accurate reporting, they should be entered as separate items, not as split gifts.  If they are entered at the same time with the same date info and appeal info, then it will be obvious that the commitment is greater than the parts.  I cannot imagine that you could have mulitple multi-year pledges from a donor and expect that they are going to follow through on payments to each separate one, especially if they are all designated to the same fund -- that seems confusing not only for your org but to the donor.  Every org I have worked has had a policy of not asking for an additional annual giving pledge if they already have an active one.  They are not asked again until the one they have is completed.


A multi-year pledge should be entered as one gift over however many years, for example, five.  Then the payments on that pledge are scheduled however the donor requests, whether that be annual, semi-annual, quarterly, or monthly and depending on how they are arranging payment, you can opt to or not to send Pledge Reminders.  This is the standard and also matches up with how the Finance Department records pledges.  The full amount of the pledge is recorded in the FY that the commitment is received. 

Not sure what is going on with your Appeals?  Though, I have seen people sharing very different ways that they are utlizing that field, and yes some make new appeals and tag them with the year included Annual2017, others rely on gifts being pledge driven and just use the same set of Appeals year over year with no year tags.  If the Appeal is being used as the Source of how pledge commitment came about - then that should easily be something you can report on if you want to see how each of your appeals did in regards to response.


Back to your direct question -- if a donor extends a pledge.  The original pledge is Adjusted with a Gift Adjustment and the total amount is increased to include the $$ amount that is being added on and the pledge schedule is adjusted to include more payments, unless you get instruction from the donor to keep the length of time the same and increase the amount of installmens.  So you would either be adjusting a 5 year pledge to 6 years and increasing the total $$ amount OR you would be adjusting and keeping the schedule at 5 years and increasing the $$ due for each remaining installment.