Much attention has been paid to the recent news from Giving USA that showed a decline in giving. While national statistics of the type shared by Giving USA are useful for tracking trends and planning strategies, the media often spins an unnecessarily dramatic response. This year it has been all doom and gloom.
Rather than focus on what happened in the past, I want to use the information to look forward and think about how I might advise my clients and all nonprofits to adjust their fundraising strategies.
- Bequest giving is on the rise
The long-awaited Great Wealth Transfer is upon us, and we can already see the impact in the Giving USA statistics. Since 2012, bequest giving is up 44% with an average 7% increase each year. If your nonprofit is not proactively talking to your donors about including a gift in their will, you are missing the opportunity of the future.
- Smart giving is, well…smart
Gifts to donor advised funds (DAFs) are not included in individual giving numbers, and insurance payouts are excluded from the bequest statistics tallied for Giving USA. Qualified Charitable Distributions (QCDs) from individual retirement funds aren’t counted in any national charitable giving statistics. This is a lot of money that is not being counted in statistics and giving trends that can have significant impact on your nonprofit’s bottom line. Each of these options – DAFs, QCDs and insurance payouts – provide significant tax, estate and financial planning benefits to donors making them smart options for nonprofits to promote.
- Where have all the small donors gone?
A trend we have been seeing for years in Giving USA and other sources is fewer donors giving bigger gifts. In fact, much of the focus in fundraising over the last few years has been on the importance of major gift work. I have given the same advice to my clients as well. But, have we dedicated so much of our resources to major gifts that we have begun to ignore the rest of our donor base? When we start to rely on fewer and fewer donors, we put the financial security and stability of our nonprofits at risk. Are your communications and stewardship enabling you to retain and grow your smaller donors into midlevel and major giving over time? With improvements in technology the ability to stay in touch with more donors in a customized and personalized way is becoming easier and more cost-effective. You need to invest in your fundraising staff and technology and do a better job with ALL donors to ensure the sustainability of your nonprofit.
It is important to stay educated on trends and statistics in the sector, but we also have to be thoughtful about how we should guide our nonprofits in responding. We can’t let our organizations and boards give up on our mission and stop asking for support because national statistics show giving is down and the media has declared that charity is dead.
One thing the research has shown us time and time again is that people will continue to give – they gave through the recession, they gave through the pandemic, they gave through political challenges – and that is not changing now. What is changing is how they give.
Educate your donors on how smart giving options – gifts in their wills, from donor advised funds, insurance and qualified charitable distributions – can benefit them and the charity they love. Take advantage of training and new technology to enhance and customize your donor communications and stewardship strategies to engage your donors more actively in your mission. Track your donor retention rates and evaluate the impact of your stewardship strategies. Survey your donors to find out why they give and what keeps them giving and adjust accordingly. Recognize ALL donors at all giving levels as critical to your mission. Every gift makes a difference, and let your donors know that!
The interpretation of statistics is critical to our planning. They aren’t showing us that giving is down, they are showing us how the future of fundraising will be different and what we need to do to prepare for it.
If your nonprofit organization is struggling to develop a fundraising plan that leverages current trends, we can help. Learn more at www.advancementadvisorsgroup.com or contact Maureen Mahoney Hill, CFRE Principal at maureen@advancementadvisorsgroup.com or 412-780-4708.