What fewer donors means to your mission
Written by:
Diana Coyle, CICF Director of Nonprofit Services and Sustainability
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. Even in 2024, a year of record-breaking charitable giving, the donor base itself was 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 maybe because 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. That could be compassion, moral obligation, empathy, or belief in a cause. Rarely is it driven chiefly by financial incentives. Keep talking about measurable impact, highlight your stakeholder testimonies, and use stories and data to share how your organization is improving Central Indiana!
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. Any new donor is 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 (Try a short video message!) that don’t necessarily involve an ask. Show them where their dollars are helping your mission and highlight how their continued investment allows for long-term organizational sustainability and impact. 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 CICF Collaborative (including the cornerstone entities, Central Indiana Community Foundation, Hamilton County Community Foundation, IMPACT Central Indiana, the Indianapolis Foundation, and Women’s Fund of Central Indiana) 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 to elevate the quality of life for Central Indiana residents! We are honored to be your partner.
About the CICF Collaborative
CICF Collaborative is a partnership of philanthropic organizations working together to strengthen communities across the region. Each entity within the CICF Collaborative (including the cornerstone entities, Central Indiana Community Foundation, Hamilton County Community Foundation, IMPACT Central Indiana, the Indianapolis Foundation, and Women’s Fund of Central Indiana) brings deep knowledge, strong relationships, and its own individual, focused mission. The CICF Collaborative unites the entities by providing shared services, allowing the entities to operate more efficiently and effectively. By leveraging what we each do best, we’re able to better serve our communities and create more lasting impact, together. Learn more »
About the Author
Diana Coyle, director of nonprofit services and sustainability, is dedicated to helping Central Indiana nonprofits access the tools, knowledge, and relationships they need to thrive. In collaboration with her CICF colleagues, she supports CICF fundholders offering professional development, resources, and technical assistance that strengthen organizations and their leaders. With more than 15 years of experience in leadership and community engagement, she is committed to fostering connections that amplify the missions of nonprofits and create lasting impact across the region.