I belong to many philatelic organizations. Several of them have stopped offering lifetime memberships. Why?

The old rule was that banks paid about 5% interest on savings. To become a life member of an organization, you paid about 20 times the annual dues. The interest earned would (more or less) subsidize the cost of the member.

For example, suppose a club charged annual dues of $10. Life membership would be about $200 (20 times $10). At 5% interest, that $200 yielded about $10 per year in interest – enough to cover the cost of that membership.

Have you noticed interest rates at banks? If you have a large sum of money to deposit in a certificate of deposit or some other financial instrument – maybe you’ll get 1% or 2% interest if you are fortunate. Interest rates are well below 1% for accounts that only have several thousands of dollars or less deposited. It doesn’t look like interest rates on savings are going to increase any time soon.

At such low rates, the old rule of 5% interest doesn’t apply anymore. In one club I belong to, over half the members are life members. This means the annual dues paying members have to now subsidize the costs of maintaining lifetime members.

One society I belong to is combating the problem by charging all members a subscription fee for a printed copy of their society journal. If you have the journal sent to your email or you get it from the member’s only area of their website, there is no cost. But even for lifetime members, if you want a hard copy mailed to you, you need to pay up.

Some organizations have stopped offering life memberships since they know there is no way to cover the annual operating costs of those memberships.

Lastly, some organizations are reaching out to members for donations across the entire membership. For example, you can become a Patron member of the club by donating, say, $50 or more. Some clubs have a tiered donation structure based on the amount of your donation indicates your contribution level. Most clubs print an annual list of donors to recognize and thank them. In general, I think many philatelists are generous with their money and will make a small donation if asked.

If interest rates ever rebound again, organizations may once again tout lifetime memberships. But in the current economic environment, most organizations have stopped offering them or at least taken a very low key approach to mentioning them – hoping that few if any apply for a lifetime membership since they know that it’s a losing proposition financially.