Diversify and Thrive: Expanding Giving for Nonprofit Sustainability

With today’s uncertainty brought about by the shifting landscape of government funding, it is even more important to expand your donor base and offer different ways for donors to contribute to your cause. Diversifying your fundraising efforts with several revenue streams is essential to your nonprofit’s sustainability. Likewise, diversification opens new opportunities for donors to get involved. The more options donors have to support you, the more likely they are to participate and deepen their connection to your cause. Individual giving is the cornerstone of philanthropy, representing a substantial portion of overall charitable contributions and plays a pivotal role in nonprofit organizations’ sustainability and impact. 

For many nonprofits an annual fund helps them cover their everyday expenses. Since other fundraising efforts (like grants) are usually intended for specific purposes, an annual fund allows nonprofits to have unrestricted funds that go toward general operations. Apart from covering a nonprofit’s operational costs, one of the main goals of the annual fund is to deepen existing donor relationships. 

If you are leading a non-profit, consider these ways of increasing overall support by providing different ways donors can support your organization: donor-advised funds, stock donations, or online recurring support:

Donor-Advised Funds (DAFs)

With over $228 billion in assets that have been set aside for charitable giving, donor-advised funds should be a priority for all nonprofits! A donor-advised fund, or DAF, is like a charitable investment account for the sole purpose of supporting nonprofit organizations. Donors contribute an irrevocable donation of cash, securities, or other assets to a donor-advised fund and are eligible to take a tax deduction. The donors can recommend what charities that they want to direct their giving. Literally anyone can set up a DAF as there is no minimum required, so this is for all donors, large and small. 

More importantly, you don’t have to wait until December to communicate with them, as the donors have already set aside the funds and received a tax-deduction. Make it easy for your donors who have a DAF to donate by providing your tax identification number in all of your communications. You can even set up the widget DAFPay on your website to make it even easier for them to donate. Consider notifying your local community foundation to let them know that your nonprofit accepts DAFs. 

Furthermore, make sure that you thank the individual donor, not the institution, that manages the DAF and track the donation accordingly in your CRM (Customer Relationship Management) software.

Stock Donations

Accepting stock donations can be an incredible fundraising incentive. Donating stock allows donors to avoid both capital gains and state income taxes that they would otherwise need to pay if they instead sold the stock to donate cash. Additionally, donors can claim a charitable deduction for the current fair market value of their stock at the time of donation. Together, these benefits can represent significant tax savings for donors. Plus, donors are often more willing to give out of their wealth (i.e., from unearned gains on investments) than out of pocket (i.e., their disposable income). Encouraging gifts of stock can unlock generosity from donors who might otherwise feel hesitant to give a major gift.

Set up a stock brokerage account to receive and manage your donated stocks, or a stock-giving tool that can liquidate gifts for you.

Your donors will need the following:

• Charitable gift transfer or letter of authorization forms from their stock brokers, which are typically available online

• Provide your nonprofit brokerage information:

  • Your brokerage’s name

  • Your organization’s account number

  • Your organization’s DTC (Depository Trust Company) ID and clearing numbers

• Ensure donors will receive tax receipts. Don’t skip this step—receipts are required for gifts valued over $250, and tax deductions are a primary motivator for stock gifts in the first place.

Monthly Giving--Online Recurring Support

Donors benefit from enrolling in recurring giving because they are able to be part of a cause they hold dear without a substantial one-time donation, making impactful giving financially manageable. In turn, nonprofits see the value of recurring giving when it comes to donor retention, upgrades, cost-effectiveness, and annual planning. Overall, recurring givers have proven more loyal with higher retention rates, and more generous with larger lifetime values than one-time givers.

Monthly giving is a form of recurring contributions in which donors contribute a specific amount each month to your nonprofit. This amount varies depending on each donor’s level of commitment to your cause and giving capacity. The best way to do this is provide the option for donors to give monthly or annually when they choose to donate online. Subsequently, let your donors know this is an option through social media, newsletters, and an email campaign.

Thank Your Donors

Thanking your donors is key to any successful campaign. A thank you will improve engagement, boost retention, and elevate the year-over-year effectiveness of your fundraising strategies. In addition to a formal acknowledgment letter or email, consider these options:

• For a more personal touch, try to send a handwritten note. Invite board members or your staff to join in on the thank-you process, perhaps as part of a retreat. 

• Spotlight a few key donors or volunteers with in-depth profiles on your social media feeds. Make sure you set the post as shareable so the supporter can re-post the content on their own feed.

• Create a short video. This might be a short thank-you speech on behalf of your executive director, or depending on the nature of your cause, you could include testimonials from beneficiaries.

• Create an online donor wall. A dedicated digital space will show your gratitude. This can be a standalone page on your nonprofit’s website or part of your header or sidebar. 

• Host donor appreciation events. Another way to say thank you is to gather your supporters and celebrate everything you’ve been able to accomplish together. It doesn’t have to be expensive, it can be a reception at your office or a virtual class like cooking, yoga, or whatever your donors may enjoy.

Key Factors to Grow Individual Support

A case for support: A compelling case for support literally “makes a case” for why someone should support your organization. This document covers all the key points and language that will serve as the backbone of cultivation and solicitation meetings, marketing materials, and more. 

Diverse fundraising strategies: Major, mid-level, and lower-level gifts will all help you reach your annual giving goal. To ensure you’re prepared to receive gifts the way supporters want to give them, ensure you have multiple strategies in place for raising support. Besides common methods like starting a recurring giving program or a membership program, consider branching out into other fundraising approaches, like accepting gifts of stock or donor-advised funds.

A strong marketing and communication plan: As with any type of fundraiser, you will only be successful in filling your annual fund if you get the word out about your campaign and goals. Ensure you take the time during the planning phase of your campaign to develop a robust marketing and communication plan. In addition to researching your audience and establishing your core campaign messages, choose a variety of channels to promote the campaign. For instance, you might use your website, social media, and email to reach a wider audience and communicate your campaign’s vision in different ways. Establish user-friendly online platforms for donations, embrace social media to share impact stories, and utilize data analytics to better understand donor behavior and preferences.

Volunteer involvement: To keep up the momentum of your campaign and give your supporters a variety of ways to get involved, incorporate several volunteer opportunities into your campaign activities. For example, you might invite volunteers to help you set up and run a fundraising event that is part of your campaign or ask more senior-level volunteers to assist you in your fundraising and solicitation work.

Need help with developing your fundraising strategy? Reach Out

What strategies do you use to navigate uncertainty? Share your tips in the comments below!

About the Author

Laura Rheintgen

Laura is a nonprofit consultant for CSR with more than 20 years of senior level fundraising experience working with international and educational nonprofit organizations. She has served on, and consulted for, nonprofit boards and leadership teams to strengthen resource development programs and capital campaigns as well as address strategic planning and governance.

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