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What You Need to Know about Giving USA 2014

Reprinted from the Fired-Up Fundraising Blog

Hurray! Charitable giving in the United States is almost back up to pre-recession levels!

Mid-June is always an important time every year when the Giving USA report comes out. Giving USA is researched and written by the widely respected Indiana University Lilly Family School of Philanthropy.

The report gives us a good sense of how well charitable giving is doing in the United States and which sectors are faring well—or poorly.

Boy, has it been a long slow slog out of the Great Recession and the exodus of so many of our donors—and their dollars.

We are not quite all the way back, but the data folks are predicting that we will surpass our former pre-recession giving peak in a year or two if current trends continue. Yay!

By the way, some of your board members may have seen the NBC News report headline on Giving USA: "Charitable Giving Hits a Record High."

I'd like to respectfully disagree with that headline. The Giving USA report says we have NOT yet reached our pre-recession high, which was $349.5 billion. Total gifts last year, gifts tracked by this report, were $335 billion—below the pre-recession peak. (So we are almost there!)

What-You-Need-to-Know-about-Giving-USA-2014_image1.jpgThe Key Facts That You Need to Know about Giving USA 2014

You may know that I really like question-and-answer formats—try this format and have your board do a guessing game—and give a prize to the person who gets closest to each answer!

How much did foundations, corporations, and individuals give last year in the United States?

$335 Billion = total giving in the United States from foundations, corporations, and individuals.

How much did charitable giving increase between 2012 and 2013?

4.4 percent—Overall giving from all sources increased by this amount.

How much did individuals give through gifts and bequests?

80 percent of all overall contributions came from individual gifts and bequests.

What-You-Need-to-Know-about-Giving-USA-2014_image2.jpgIn 2013, what percentage of gifts came from individual donors? Corporate donors? Foundation donors?

Individual gifts were 72 percent of the total.

Corporate gifts were 5 percent.

Foundation gifts were 15 percent.

Bequests were 8 percent.

How about corporate gifts? Were they up or down?

Corporate gifts were down 1.9 percent. But last year they were up over 19 percent.

Just remember that after the recession, many corporations shifted their giving to in-kind. According to a June 19 podcast, around 60 percent of corporate gifts these days are in-kind.

What's the trend with foundation gifts?

Overall giving TO foundations was down significantly this year, by 15.5 percent.

But gifts FROM foundations were up by 5.7 percent. (Yes, this is confusing!)

But remember, foundation gifts still make up only 15 percent of all charitable giving.

What-You-Need-to-Know-about-Giving-USA-2014_image3.jpgWhich subsectors of the nonprofit arena fared well last year?

Health care and education were the big winners last year—seeing solid increases over 2012. Why? These nonprofits make heavy investments in their fundraising programs, and therefore they raise tons more money.

Giving to the arts, health care, the environment, and education has risen consistently over the past few years. As a former ballet dancer, I'm happy to see that giving to the arts, culture, and humanities grew by 7.8 percent.

Which subsectors received less support in the past year?

Gifts to religious causes were flat. Also international giving decreased by 6.7 percent.

What Does All This Mean to You?

Be optimistic and ride the tide!

Giving is going nowhere but up. Are your fundraising strategies up to speed? Remember fundraising is well researched and professionalized these days.

Some strategies are not working as well as in the past. Be sure you are smart and efficient and that you know how to talk to your donor correctly.

How important is the role of individuals?

Yet again we see that—on the whole—most gifts come from individuals. Corporate, government, and foundation support just won't cut it for your organization.

Do you have a major donor program? Do you have a great donor thank-you program? Are you sending loving messages out to your donors telling them how wonderful they are?

How about the role of the economy and stock market?

All philanthropy is dependent on the overall economy.

As personal income rises, the unemployment rate goes down, personal disposable income and consumer confidence all go up—giving of course follows these positive trends.

Charitable giving always tends to lag after the stock market. When the market goes down, it takes a while for giving to go down. And when the market turns around and goes up, giving will also go up, but not as quickly.

What role do wealthy individuals play?

The increase in giving mostly came from very large multimillion dollar gifts and bequests from the very wealthy. There were several mega gifts from wealthy donors of $80 million and more, helping to boost the overall numbers.

Don't despair! Most mega gifts are given locally. Your potential transformational gift may be right under your nose.

As wealth in the United States continues to be concentrated more and more in the top 1 percent, your major gift program needs to be targeted carefully on wealthy individuals. (This is not new news!)

How's broad-based giving doing?

What we call broad-based giving has not recovered so robustly. And mega gifts still tend to favor the huge prestigious institutions.

All the more reason to focus on your OWN major gifts program. That is what will save your bottom line—and the people you serve.

Bequests are a huge sleeper for you!

Bequests are the sleeper fundraising strategy. Too many organizations overly complicate planned giving.

Just talk about bequests in all your materials. Just a little mention at the bottom of the page. Nudge your loyal donors in that direction.

Do you know who your most likely bequest donor is? It's the person who is contributing consistently over a decade or two.

Their gifts may be as small as $20 a year—but you are in their hearts and probably in their wills.

Bottom Line

Focus on the wealthy. Focus on individuals. Create a donor retention task force to "love on" your current donors.

Sharpen up your fundraising strategies and most importantly your language. Revitalize your major gifts program.

And you'll ride the tide as the world economy continues to improve!

What-You-Need-to-Know-about-Giving-USA-2014_Gail-Perry.pngGail Perry, MBA, CFRE, Fired-Up Fundraising
© 2014, Fired-Up Fundraising. Reprinted with permission.

Gail Perry is an international fundraising consultant, coach, speaker, blogger and thought leader. You can find her at her popular Fired-Up Fundraising blog. Her Fired-Up Fundraising approach, developed over the past 25 years as a nonprofit philanthropy expert, has helped organizations raise hundreds of millions in gifts and support. Her book, Fired-Up Fundraising: Turn Board Passion into Action, has been called the "gold standard guide to building successful fundraising boards."

Topics: Fundraising