Hot 2018 Trend Tip: Boost Major Gift Solicitation of Older Donors Now

By Laurence A. Pagnoni, MPA

Overwhelming 2018 data indicates significant charitable giving increases in giving by high-income donors (incomes over $1 million annually), but an overall decline in giving for lower-income individuals because of the new tax laws.

The increase in donor-advised funds also supports the data.

Adding to this data, the 90/10 rule (90% of the dollars will come from 10% of the donors) applies. It tells you that you should be spending 90% of your time working with the top 10% of the donors, not the other 90% who will only provide 10% of the donations. This was formerly known as the 80/20 rule; however, after the 1988 recession, and with the income gap raging out of control, I have found that 95% of the money comes from 2-3% of the donors. Regardless of the precise figures, which will vary among organizations, there are always a small number of donors providing most of the financial support, and they are almost always older.

I urge you to consider the impact this information will have on how your year-end solicitation strategy and overall development approach. I wrote about how to conduct these meetings a few weeks back in my post about in-person meetings.

Such a meeting can also boost your planned giving, which is an imperative. Why? Because donors aged 65 and older comprise (by far) the largest slice of the American charity pie. This is especially true because those age 70.5 and older with an IRA can now donate their required minimum distribution to your nonprofit.

Those under age 35 comprise the smallest slice of the same charity pie.

As master fundraiser Tom Ahearn notes, the typical donor is age 75. Tom goes on to note that the young will likely always be the smallest slice of the charity pie in the US, for obvious economic reasons.

We’ve always known that as people age they give away more to nonprofits.

 

We welcome your comments about this post on the LAPA blog.

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