At its heart, fundraising is a simple process that can lead to big things – people asking people to support causes dear to their heart. But, as you know, that doesn’t mean that fundraising is easy.
While the US is still recovering from the pandemic and dealing with inflation, the data for fundraising shows that things are still looking strong and optimistic. In the Fundraising Effectiveness Project’s most recent report, they found that while the number of donors were down 7%, donations were up 6.2%, thanks to major donors.
GivingTuesday estimates that giving in the United States alone totaled $3.1 billion representing a 15% increase compared to GivingTuesday 2021, and a 25% increase since 2020. While this is just one day of giving, it represents a positive end to the year.
What are the fundraising trends to watch in 2023?
Donor acquisition and retention are still key. The pandemic brought new donors to many nonprofits. But those gains are slowly diminishing. The FEP found a steep decline in donor acquisition and retention in the second quarter of 2022. But the same report found that recaptured donors and newly retained donors increased and stabilized. Make sure to double down on your efforts to acquire new donors and retain the ones you currently have. And don’t give up on those you’ve lost; recapturing them can be lucrative as well.
Changing laws regarding retirement accounts. A recently-signed law has changed some rules around retirement accounts. CNBC has a good recap. Keeping up on the latest tax laws about retirement accounts is important when engaging with donors. The required minimum distribution (RMD) age has been raised to 73 and will be raised again to 75 by 2033. Also, the tax penalty for those that fail to meet their RMD by the deadline have been lowered from 50% to 25%. Additionally, in 2024 Roth 401ks will not be subject to RMDs.
AI, marketing and fundrasing. Have you heard of ChatGPT? If not, now is the time to learn about it. It is a potential game changing technology – or maybe just another tech fad. Only time will tell. But it is a technology you should familiarize yourself with and keep an eye on. Depending on how the technology evolves, it could replace Google (easier, more direct search results and information) or human writers (although we won’t be putting our pens away any time soon).
Are you looking to run a capital campaign in 2023? Or do you have questions about how to harness AI and retain donors? Please contact me at any time.
