Like everyone else, our railroad museum & historical society is always looking for new ways to generate income. A recent suggestion is to offer Life Memberships. Before committing to this, we were wondering what has been the experience of other groups with this. Do you offer it, or have you considered and passed on the idea? Some of our specific issues and concerns:

- What should be the price of a Life Membership? (we’re considering $500, versus a current basic annual dues of $35. We also presently have the usual variety of higher levels of annual membership)

- Do the long-term costs of providing publications and other services to Life members outweigh the benefit of their one-time payment?

- Should the offering of Life Memberships be a limited, one-time event, or an on-going option for membership?

- Should some - or all - of the proceeds from selling Life Memberships be set aside in a reserve fund or endowment?

Thanks in advance for your comments, advice, and suggestions.


Rick Bates
Reading Railroad Heritage Museum/RCT&HS

A few museums priced Life Memberships, continuously available for sale, at 20 times the 1 year rate. In the past, interest on long tern savings and Certificates of Deposit was about 5% per year. Of course, this doesn't account for inflation in postage rates, etc., or differing remaining life spans if the money is treated as an annuity with nothing remaining at death, instead of as an endowment. And, some museums are so poor that they use the endowment to cover the overdraft in the checking account.
More work with financial planners and actuaries could help you guess the proper charge.

When you offer life memberships you are basically betting the member is going to expire before the benefits and services he receives exceed the fare, and the member is betting he is going to last long enough to come out better than he would have with yearly membership. But in most cases the people who sign up for life memberships do so because they are dedicated to the objectives of the organization and do not anticipate ever leaving the group.

Back when the single railroad historical society trend began, I bought life memberships in a number of the groups. Most of them have long since discontinued offering life memberships. In some of the groups the officers have commented that the old fossils with life membership are costing them a lot of money. I tell them that they should consider the value of the contributions, the volunteered time and effort, articles, research, running around doing errands, and support for their events and activities, that the life members provide over the course of many decades before they write it off as a loss.

PC

Our museum no longer offers life memberships. When we did, the cost was twenty times the annual cost.

I've come out ahead financially, but many didn't.

However, handing over such a large amount for a life membership is a good indication that the member is indeed making a lifetime commitment and is not afraid to support the museum financially. Typically, life members can be counted on to contribute heavily, financially and/ or through volunteer effort, to the museum through their lifetime. That pays for a lot of newsletters.

If they were continually being billed for annual memberships, would they be as likely to make regular large donations? I'm guessing not.

Your experience may vary, of course.

Steve Hunter
Cardinal, Ontario

For comparison, the dues and life membership rates for the California Alumni Assoiciation (U.C. Berkeley) are:

Recent grads - $30/yr or $500 life (16.6 times annual)
Standard rate - $60/yr or $750 life (12.5 times annual)
Seniors - $50/yr or $500/life (10 times annual)

Life memberships can be paid in five annual installments.

I think their idea of relating lifetime dues to life expectancy makes sense, and also the optional installment plan is a good selling point.

About twenty years ago, life members were asked to send in an optional extra $100 to offset increased costs. I don't know how many actually did...

Another consideration is using the life membership to acknowledge the munificence of generous donors. For example, if a patron of your historic cause believes enough in your organization to donate a four- or five-figure sum, I believe that's worth a lifetime membership, whether the donor asked for it or not.

Here are the reasons:

1) Donations of that magnitude are hard to come by and should be given significant recognition. To my mind, a lifetime membership would mean more than a plaque or token gift.

2) By making the donors members, you are including them in the organization. They get the newsletter and special mailings and feel part of the organization. More incentive to continue donating.

3) Most people who can afford donating a four- or five-figure sum are -- um, how can I put this delicately? -- in an actuarial demographic that is favorable to the organization.

Who would donate such a sum if they weren't already members of an historic group? People who come to your facility who have such a good time that they want to encourage the well being of the organization. People who are invited guests of special events. And people who are friends of members who are already significant supporters.

Otherwise, I suggest making the cost of the life membership high enough that it's not a no-brainer. 20x the annual dues, or a minimum of $1000, is a good start. The cost of the lifetime membership should be reviewed every couple of years to make sure it stays ahead of inflation. If you established a $500 lifetime membership twenty years ago, when it appeared to be a real stretch for the average member, it has since morphed into a bargain if it hasn't been increased in the meantime.

--Bill Schafer

We have a dozen or so life memberships at $1000, mostly dedicated members who want to help us out. We are (at twenty years old) new enough to need to be building up our reserves, but established enough to make folks feel confident that we won't blow away next year. I think LMs make sense if you have a need for an income 'bump', like a new project, but may not make as much sense for the more established organizations, since it is essentially a loan against your future revenues.
Sam

Here's the scariest prospect yet:

In 1981 I joined a British diesel preservation group not long after their formation, and for years I was bartering goods with British pen pals (some of whom were fellow members) to have them pay my membership dues.

In 1991, during my first (and thus far only) outing to the UK, I caught up with the membership chairman at one of the open house events by prior appointment and eagerly forked over what was then the Life Membership Overseas rate: £100.00. This was before the popularity of the Internet and online money/commerce transactions.

They currently spend almost £12 a year to send me my periodicals.

The current rates are Adult £19.00 (UK), £23.00 (overseas), Life Membership £285.00 (UK), £345.00 (overseas).

I've had to make occasional contributions here and there just to clear my conscience. If my father's age is any indication, I'm there for another 30+ years. It's a double curse upon them, because their fan base in 1982 was largely under 40 years of age, many under 20. (Imagine the average age of the membership of the Conrail Historical Society, the Amtrak Historical Society, or a CSX or NS or BNSF Historical Society. Now, compare to the average age of the PRRT&HS, or B&O or Monon or NKP or NP or SAL/ACL society........)

I would suggest that if you have a new and relatively young-age-skewed group, you might want to offer life memberships only as a limited time offer, for the first year or two, when a cash infusion may be critical. Life memberships may not work as well or be so popular with well-established groups or operations.

Oh, and a final laugh? In the 1980s I mailed in to Kalmbach Publishing a fully intact order form from a 1940's issue of Trains Magazine, offering a lifetime subscription for $7.50. Needless to say, the offer was not accepted; that was just before Kalmbach moved out to Waukesha, and I understand David P. Morgan got quite a chuckle at the initiative/joke......

I am not a member of the National Model Railroad Association (NMRA), but I think a saw a recent membership list that indicated that it was offering a life membership. To get a rate you have to send them your age and I guess they look at an actuary table to figure out what to charge you.

I still kick myself for not shelling our $60 for a lifetime subscription to Trains magazine 50+ years ago.

Our group continues to offer life memberships... but continues to request additional donations from all members, especially life members...

As a life member of the UC Berkeley Alumni Association, (mentioned above) they also continue to call and request additional donations from life members... frequently... often... sometimes at dinner.... again... again... and again....

A life membership is not just a subscription to the newsletter for life... it is a life long commitment to a relationship with the group...