Charities look to make up for weak revenue, shifting donor base this GivingTuesday
Inflation has strained consumers' finances in recent years. It is also having an impact on the charities that depend on donations to do their mission-driven work.
Even as charities feel the economic squeeze, however, those in the grant-giving, civil rights, social causes, and educational sectors have seen substantial growth in donations over the last year.
Windfall analyzed Giving USA data, a collaborative study between Bank of America and Indiana University, as well as its own proprietary data on nonprofits, to illustrate how charitable giving is shifting ahead of this year's GivingTuesday.
GivingTuesday has been a key fundraising opportunity for charities around the country to harness the gratitude and goodwill of a broad swath of donors during the holiday season. In 2023, donations increased just 0.6% from the year before, after adjusting for inflation―a miniscule change after a historically hot inflationary period and a declining number of big donors.
A 2023 study by the Indiana University Lilly Family School of Philanthropy and Bank of America found that 8 in 10 affluent individuals gave charitably. Respondents, whose average income and net worth were approximately $524,000 and $31.0 million, respectively, gave about 17.5 times more to charity than the general population during the 2022 calendar year.
Similarly, an analysis from Windfall―a wealth intelligence and AI company―of more than 1,000 nonprofit organizations, showed that households with the highest net worths give at higher rates, making them a critical piece of the nonprofit economy. Older generations tended to give at higher rates than millennials, according to Windfall's analysis, with baby boomers and donors over age 78 drawing from wealth likely accumulated over a lifetime.
In recent years, however, more donations are coming from fewer people as the average age of donors who give their first large gift has increased to 66 years of age, according to Joshua Meyer, vice president of Market Engagement at Bloomerang, writing for Giving USA.
The shifting demographics of who gives could portend a changing philanthropic landscape. As nonprofits hope sluggish revenue growth, dragged down by inflation, is behind them, they are hopefully looking to double down on growth through large donations in the coming years.
Visit thestacker.com for similar lists and stories.
Comments