What does fewer donors mean to your mission

If you’ve been in a fundraising role for a while, you might have observed that your donor list has been shrinking in recent years. It is not your imagination! Even in 2024, a year of record-breaking total giving, the donor base itself is declining.

Two decades ago, approximately two-thirds of U.S. households made charitable donations annually; today, that number has dropped to under half. This means that although certainly total gift volume can grow, it is often driven by a smaller core of high-net-worth donors, leaving more organizations competing for a shrinking base of everyday givers.

So, how should you address this shift toward “top-heavy philanthropy”? Here are a few suggestions:

Keep talking about impact

Despite–or perhaps in light of–the recent whirlwind of commentary about new federal laws and the implications for the charitable deduction and charitable giving, it is really important to keep in mind that for most individuals, the decision to give is driven by deeply personal factors–such as compassion, moral obligation, empathy, or a belief in a cause—rather than financial incentives. So keep talking about impact and how your organization is improving the quality of life in our region!

Step up your stewardship game

It is important not only to focus relationship building on your long-term, major donors, but also on your newest donors–even if those new donors are giving just a small amount. Many donors start small and may be testing you out. A new donor is always cause for celebration–especially in today’s climate. Consider developing a simple framework laying out the steps to engage a new donor, starting with adding the donor to your email list, of course, followed perhaps by personal outreach via multiple channels of communication that don’t involve an ask. If you build the relationship up front, bigger dollars are more likely to follow later.

Lean into complexity

The increased standard income tax deduction certainly has been a factor in the declining number of donors since 2017. With so many fewer people itemizing their income tax deductions, tax benefits are no longer the nudge they used to be to encourage people to give to charity. But that doesn’t mean you should give up staying current on tax planning techniques involving charitable giving. Many high-net-worth donors and high-income earners who still itemize deductions are very philanthropic and may be open to establishing formal charitable giving plans to support favorite organizations, including yours. The experienced team at Kitsap Community Foundation is happy to work with you and your donors on gifts of closely-held business interests, real estate, and other complex assets, so when you encounter a potential opportunity, don’t say no. Reach out to our team!

Thank you for all you do for our region! Kitsap Community Foundation is honored to be your partner.