As I See It: Giving USA 2024: The Annual Report on Philanthropy for the Year 2023
Photo: GUSA2024
The Annual Report on Philanthropy for the Year 2023 released in June announced that U.S. charitable giving totaled $557.16 billion in 2023, reaching a high in current dollars but did not outpace inflation. Total giving grew 1.9% in current dollars, reaching a new high by that measure. However, due to a higher than average (4.1%) inflation rate, adjusted for inflation, giving declined by 2.1%.
After a tumultuous 2022, total giving’s growth in 2023 may be a positive sign for the nonprofit sector. Total giving remains above pre-pandemic levels, even when adjusted for inflation. Giving in 2023 was partly driven by growth in the stock market and GDP, which support giving by corporations, foundations and individuals. Growth in personal income and consumer spending also lifted individual giving.
Individual giving remains the strongest source of charitable giving at 67%. Foundations are also giving more, making up 19% of charitable giving. Strong market growth in the past five years increased the value of assets held by foundations, which in turn enabled foundations to give more over time, according to Una Osili, Ph.D, Associate Dean of Research and International Programs at the Indiana University Lilly Family School of Philanthropy. Giving by bequests rose by 4.8%, totaling 8% and corporations provided 7% of charitable giving.
For professional fundraisers and the nonprofits they represent, this resiliency in giving in 2023 after a tough 2022 should be inspiring. However, inflation has been tough on nonprofits, and most are experiencing continuingly rising costs. It’s also tough on the everyday giver who is juggling increasing household costs and a desire to support charities. As the needs of nonprofit organizations continue to grow, fundraisers with few resources are focusing on the top tier donors to yield immediate results. Many annual fundraising goals are far too aggressive to keep pace with inflation. Yet this strategy will hurt nonprofit organizations over time as they lose donors who are important now and to their future.
Here are a few thoughts for nonprofits from this year’s data as you consider your fundraising strategy for the remainder of this year and next.
Focus on stewarding the everyday and mid-level donors to encourage their continued support. It is far more expensive and time-consuming to acquire new donors than it is to retain them. Work to move transactional givers to direct givers by offering giving opportunities that are a reasonable step up.
Invest resources in personnel and technology to build closer relationships with every day and mid-level donors. This investment will pay off as you move donors up to making major and planned gifts.
Pay attention to your Gen X and Millennial donors. They are charitable and want to be stewarded and recognized for their contributions today.
Talk with your Baby Boomer donors about their charitable plans. Ask them if they have invested in donor advised funds or have plans for family foundations. Baby boomers founded many of America's nonprofit organizations and they are highly interested in continuing to impact their communities through legacy giving.
Train your fundraising team in the art of stewardship, cultivation and solicitation in a relationship-based model that satisfies both the nonprofit and individual's needs.
Intentionally open the opportunity for volunteering and giving to everyone, not just those with the most resources.
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To obtain a free infographic, please click this link.
Does your organization need help building a sustainable giving program? M. Gale would love to visit with you about development assessment and planning, as well as organizational readiness. Reach out to us at: info@mgale.co or call 888-647-7942.
As President and Founder of M. Gale, Missy Gale has dedicated almost three decades to crafting unique strategies and solutions to complex fundraising projects and organizational issues, resulting in transformational fundraising success for her clients. With more than 15 years at the helm of M. Gale, Missy has assisted nonprofits in North Texas and the Southwest in the areas of healthcare, arts and culture, human services, and education. She has been honored as the Outstanding Professional Fundraiser by the Association of Fundraising Professionals Fort Worth Metro chapter and named A Great Woman of Texas by the Fort Worth Business Press. Dedicated both professionally and as a volunteer, Missy is currently serving as a board member of the Giving USA Foundation, and as a committee member for the Santa Fe Farmer’s Market Institute.
