Checking the Rearview Mirror: Charitable trends from the pandemic year
2020 was a wild ride. As we glance in the rearview mirror, we are reminded of our shared stories and lessons learned.
The same is true in Giving USA’s philanthropic retrospective about 2020. This week, continuing a 55+ year tradition, Giving USA released their annual report analyzing philanthropic trends.
As we know, good data—both internal and external—undergirds all successful development programs. Let’s take a look at the 2020 data so we can leverage these findings to maximize our fundraising results and achieve our organization’s missions. If 2020 was anything, it was uneven and unpredictable. The economic situation was mixed, with some folks’ stock portfolios soaring, while unemployment rates were at their highest (14.8%) since that data collection began in 1948. As expected, this led to some interesting deviations from the usual philanthropic trends. In some ways, 2020 bucked the trends and lived up to the “wild ride”:
Although 2020 was a recession, giving increased by 3.8%. (MacKenzie Scott and other mega-donors played a role in this increase.)
Foundation giving reached record-setting levels. Forty years ago, foundations accounted for only 6% of giving, and now they’re 19%! Much of this is due to stock market growth which increases foundation assets and, therefore, increases payouts. Also, more than 800 foundations pledged to loosen restrictions and give more generously in 2020 to meet urgent needs.
Online giving leaped from 8.7% to 13% of total giving. (Keep in mind, that’s by total dollar amount. When considering the number of gifts, the vast majority of donations are made online, but they tend to be smaller gifts. Major donors give through other vehicles.)
Interest in planned gifts and bequests significantly increased as a result of the pandemic.
Despite predictions that many nonprofits wouldn’t survive 2020, the number of nonprofits actually increased. The CARES Act and PPP loans saved many vulnerable organizations.
In other ways, 2020 remained steady and reaffirmed long-term philanthropic trends:
The vast majority—about 86% of all giving—comes from individuals. (This includes direct gifts, bequests, and about half of all foundation giving. Many family foundation gifts are given on behalf of individual donors.)
Religion remains the highest area of giving in the U.S. at $131.08 billion. (Although, it dropped to a new low of 28% of total giving.)
Individuals are amazingly generous: they want to respond to crises and societal issues (i.e. pandemic, racial equity movement, etc.). In particular, they rallied around human service and education issues.
How can you apply this information and strengthen your organization’s development program? Our top recommendations:
Embed planned giving reminders in annual fund appeals, newsletters, and other regular communications. Your donors are already thinking about their legacy; remind them that you can help them have the impact they desire.
Thank your donors! There are more than 1.3 million nonprofits in the United States. If you don’t appreciate your donors, they’ll find other organizations that will.
Continue to be innovative. 2020 fundraising results not only affirm Americans’ generosity, but also the creativity of nonprofits and fundraisers. As the world reopens, don’t mindlessly go back to “the old way of doing business.” Instead, keep that innovative mindset and consider new ways to engage donors in the meaningful work of your organization.
Focus on accessibility by using online platforms well. Most gifts are now received online, and are increasingly made through a phone. Check to make sure your donation form is easy to complete. Consider a text-to-donate option or explore TikTok and Clubhouse to engage new audiences.
Be grateful. We are the lucky ones: we get to do this nonprofit work and advance the greater good. Let go of your scarcity mindset and remember that people are generous and want to join you in changing the world.
Chat back… What surprised or delighted you from the Giving USA 2021 report? What new strategies or tactics are you employing this year to grow your fundraising success? Interested in reading more? Check out these articles. Americans Gave a Record $471 Billion to Charity in 2020, Amid Concerns About the Coronavirus Pandemic, Job Losses, and Racial Justice, The Chronicle of Philanthropy Giving Grew in a Tumultuous Year but Not for All. What’s Ahead in 2021?, The Chronicle of Philanthropy Persevering Through Crisis: The State of Nonprofits (The Center for Effective Philanthropy) Giving In 2020 Hit Record $471 Billion, Up 5.1%, The NonProfit Times