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Friday, June 11, 2010

More About Giving In 2009 and Predictions For 2010

The Chronicle of Philanthropy had an online discussion this afternoon about Giving USA’s annual report on donations which was published earlier this week. Participants included an expert in religious giving (these charities got 1/3 of the donations in 2009), a researcher from Boston College (who says giving is down 10% since the start of the recession) and a professor who is a key participant in the Giving USA study (they say giving is down about 5% since the recession). Here are some highlights from that informative chat:
  • Larger religious charities did better in 2009 than 2008. In particular, those with >$25 million in contributions saw donations increase 1.75% while those with $3 million in contributions or less saw giving decrease 10.75%.
  • Overall, religious groups are reporting a dip in giving of 1.8% from ’09 to ’08.
  • Those charities that were able to maintain and strengthen relationships with existing donors faired the best. This may be why larger religious charities are doing better --- they have greater visibility and more staff to cultivate relationships.
  • Giving USA’s historical data shows that it takes 3-5 years for giving to bounce back to pre-recession levels.
  • There doesn’t appear to be a correlation between the economy and religious giving.
  • Giving is influenced not just by an individual’s actual level of wealth, but also by the individual’s fears about their future wealth. Thus continued volatility in the market this year could dampen giving.
  • Wealthy donors, in the high tax brackets, are concerned about the possibility of higher taxes in 2011 in combination with a limit on the deduction percentage for their charitable giving.
  • The experts recommended that charities continue to budget conservatively for the next couple of years in anticipation that all types of gifts (individuals, foundations, corporations, government) will be slow to rebound.
  • It was suggested that charities move away from expensive types of fundraising endeavors, such as direct mail, and put more emphasis on less expensive, online tactics, such as electronic newsletters, Twitter and the like.
  • Small charities could improve their fundraising efficiency by relying more on Board members for assistance in stewardship. It was noted that having a Board member make direct contact with a donor – by phone, in person or by letter – could be very effective.
Finally, below are the results of our little survey to see if our followers - both donors and charities - experienced a drop in giving last year as reported in Giving USA.

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