We welcome back a special guest: Stelter’s Senior Gift Planning Consultant, Lynn M. Gaumer, J.D. to share her analysis on Giving USA’s 2021 numbers.
History Repeats Itself: Americans Rise Up and Give in 2020
History shows that during challenging times or in response to natural disasters, Americans demonstrate their philanthropy. Even in the wake of 9/11 and the Great Recession, individuals continued to give.
Giving USA’s latest report shows that 2020 was no exception.
Last year we faced a global health pandemic, an economic downturn and a nationwide reflection on racial inequality and social injustices. Confronted by adversity, we’ve seen time and again that the world unites and helps those most impacted. Charitable giving is now seen as a component of unity and togetherness.
Let’s take a deeper dive into Giving USA’s 2021 report to see how Americans rose to the challenge and gave in 2020.
The Big Picture
When you combine individual donations, corporate donations, bequests and foundation giving, Americans gave a record $471.44 billion in 2020. This equates to more than $1.29 billion per day. By adding the individual and bequest numbers, we see that individuals contributed about 78% of all dollars given to charity in 2020.
This is a key stat to use when trying to make your case to start or expand your planned giving program.
Where are the Charitable Dollars Going?
Seven of the 9 charitable sectors saw growth in 2020. Public-society benefit (15.7%) and environment/animals (11.6%) led the way with double-digit growth. Not far behind were human services (9.7%), international affairs (9.1%) and education (9%).
There was positive two-year growth for all nine subsectors. This was critical to sustaining many organizations during turbulent times.
Who Is Giving?
Individuals continue to be the backbone of charitable giving. They gave $324.10 billion and represented 69% of all charitable giving. This was a 2.2% increase (1% when adjusted for inflation). A response to the pandemic, economic need, racial and social justice movements along with the CARES Act and a strong stock market (the S&P 500 grew by 16.3%) likely contributed.
A 17% increase in giving by foundations was perhaps due to a robust economic environment in the latter half of the year and shows a trend that donors are setting aside money to make gifts at a later time.
Over $41 billion was given via bequests, an increase of 10.3%. The amount tends to fluctuate from year to year based on the estates of high net worth donors and is less influenced by economic factors. You should continue to promote bequests, as they continue to provide a solid foundation of any planned giving program.
Google Trends showed a significant increase in online searches for estate planning terms last year. In addition, many of your donors turned to digital tools to create their estate plans. This reinforces the need for continued stewardship and staying top of mind. Check out the recent study on wills and estate planning during 2020 from Care.com for additional insight.
The Giving USA data shows that corporate giving declined by 6.1%. This should not be surprising as many corporations (especially those in the travel and transportation, leisure and entertainment industries) incurred losses last year. In addition, gross domestic product (GDP) declined by 2.3% and corporate pre-tax profits declined by 3.5%.
Get the Report
To learn more about the sources and uses of charitable donations this past year, read Giving USA’s press release.
You can see the numbers with our infographic below:
3 Key Takeaways: New Approaches to Fundraising
The year spurred three key areas of change: innovation, online giving and an influx of new donors.
1. Innovation: Last year brought creative new ways to show impact, build relationships and reach new audiences. I see this trend continuing. Take your audience behind the scenes to show what your organization is really like. Show them the process of putting together care packages or prepping for an event. Introduce them to a scholarship or program recipient. Give them a tour of your facility. The options are endless, and the transparency will be appreciated.
Consider spotlighting your team and highlighting fun facts. Video is a dynamic way to get your message to your donors.
2. Online giving: This area increased by 20.7% and now represents nearly 13% of total giving. This is the highest share of total giving on record according to a recent report from Blackbaud Institute. Here is Blackbaud’s summary of the percentage of total fundraising from online giving by subsector.
Your donors are online. Make your online pages reliable and readable. Provide an easy-to-follow donor journey on your planned giving websites. And don’t forget social media. According to Pew Research Group, Facebook remains one of the most widely used online platforms among U.S. adults. Make it easy for donors to use their phones, tablets and computers to make donations; to start the process of recommending a grant from a donor advised fund or, for those 70½ and older, to request a qualified charitable distribution from their IRA.
3. New Donors: Many nonprofits enjoyed an influx of new donors in 2020. Donor retention is key to build support for your organization.
Here are a few tips:
- Steward these donors by communicating the impact their gifts made last year. Let them in on your 2021 plans and provide a long-term look at your organization’s goals.
- Engage from the heart. Be real and talk from a place of sincerity. Donors can recognize a sales call, which could result in a move from feeling neutral to feeling negative about your organization.
- Make the biggest impact through small but genuine gestures of gratitude. A simple thank-you can have a powerful domino effect. In her book, Donor Centered Fundraising, Penelope Burk revealed that donors who received a thank-you phone call from a board member within 24 hours of receiving the gift gave 39% more than non-thanked donors the next time they were solicited. After 14 months, those called were giving 42% more.
Where Planned Giving Fits In
These Giving USA 2021 numbers show that planned giving is a critical component of your fundraising efforts. If your organization does not have a planned giving program, use this latest data to garner support from your board of directors.
Can’t get enough data on giving? Register for our complimentary webinar, The Elusive, Ever-Changing and Shape-Shifting Planned Giving Donor, with Katherine Swank, JD and Lawrence C Henze, MPA, JD, from Blackbaud Target Analytics.
You’ll learn about the findings from Blackbaud’s 20+ year study of deferred gift donors in the U.S. and Canada. Katherine and Lawrence will explain this comprehensive set of individual behavioral, wealth, consumer and philanthropic insights and how they apply advanced analytic methods to understand these individuals and how they’ve evolved over the years.
Attend this webinar to learn about:
- Characteristics of planned giving donors now compared to five years ago
- Specific data you should collect to better inform your planned giving efforts
- Database and fundraising strategies to help you grow your planned giving program
- Modeled and wealth data available to you
Let’s Hear From You
What are your thoughts on the latest numbers from Giving USA? How did your organization pivot to meet changing needs? Share your insights in the comments below.