Americans Are Incredibly Generous

The annual results of Giving USA are in, and once again Americans gave in unprecedented fashion. Specifically, $390.05 billion was gifted in one of four categories: direct gifts ($281.6 billion or 72% of the total), foundation gifts ($59.28 billion or 15% of the total), bequest gifts ($30.36 billion or 8% of the total) and corporate gifts ($18.55 billion or 5% of the total).

What I’ve found interesting though, is the fact that individuals play such an important role in giving. For example, individuals make bequests, so that brings the total giving by individuals to 80%. Yet, it doesn’t end there. About half of all foundation gifts come from family foundations, which are mostly controlled by individuals. That raises the total given further to almost 88% or $343 billion.

I offer a few points of reflection about these numbers:

First, America is amazingly generous

Our level of giving is unparalleled anywhere in the world. For example, last year charitable giving as a percentage of America’s GDP was 1.44%. The countries closest in giving to the US are New Zealand at 0.79% of GDP, Canada at .77% of GDP and the UK at .54% of GDP. In contrast, the countries that were furthest away from the US were France (0.11% of GDP) and China (0.03 % of GDP). Fully, 83% of American households donated to charity in the last year compared with China (11% of households) and India (14% of households). Those were among the least charitable countries.

Second, too often nonprofit fundraising depends on corporations and foundations almost to the exclusion of individuals

All too frequently, nonprofits rely on a few foundation and corporate gifts and not enough gifts from individuals. No doubt, they receive gifts from individuals, but those usually come through direct mail or special events. Executives often work hard, but they sometimes fail to work smart by locating, cultivating and eventually soliciting major gifts in face-to-face visits.

That’s where doing your homework and building relationships with individuals pays off. Certainly that takes time, but the transformational potential of a large major gift is well worth the effort. And there is a high probability that there are people in your universe who regularly make major gifts. In fact, 93% of high net worth households ($1,000,000 or more) gave to charity, and their average gift was $25,000 or more. The money is there, but nonprofit executives will have to work and be resourceful to get their case in front of these donors.

Third, If you haven’t experienced increases in funding over the last year, you may need help.

Giving USA tracks nine sectors annually, and all of them experienced increases. These include giving to religion; education; human services; foundations; health; public-society benefit; arts, culture and humanities; international affairs; environment/animals; and individuals. Additionally, giving by individuals (the largest source of gifts) grew by nearly 4%.

The results are impressive, but what if your organization hasn’t experienced such increases? There may be several reasons. As a fundraising consultant, I would counsel clients to start by answering a few questions:

  • How many individuals give?
  • What has the trend been over the last few years?
  • What sources give (individuals, foundations, bequests or corporations)?
  • How do we grow our donor base and how can board members help?
  • What is our donor retention rate?

These are just a few questions to answer if you want to experience the increases other organizations have been experiencing. Professional fundraising audits and fundraising plans are also quite helpful. However, regardless of what you do, it will require deliberate work that includes analysis, strategic planning and action to move your organization forward. Yet, if you’re up for the task, it is well worth the effort!