The end of the year is marked by tradition — at home many celebrate holidays, and within organizations it is a time of annual reflection and planning. But in the world of philanthropy there is another sign of the season: year-end giving. Many organizations orient their activities around this calendar cycle. Nonprofits have their annual appeals and fundraisers, and businesses and individuals consider charitable allocation. The result is that, for many nonprofits, the majority of individual and corporate occurs in the last 8 weeks of the year.
While a successful end of year giving campaign can be an essential lifeline, this compressed timeline can prove challenging for non-profits as they seek to forecast and manage their budgets while keeping sufficient cash on hand. Increasingly, organizations are asking how to move away from a season of giving towards a year-round culture of philanthropy.
For organizations seeking to translate their end of year giving into year-round support, there is no silver bullet. But leaders of nonprofits are increasingly seeking ways to build stable and predictable income streams from individual donors.
In many cases, that means building a network of recurring monthly donors and supporters. We’ve seen nonprofits pursue many different strategies to create monthly supporters, from things as simple as setting the online giving default to “monthly” instead of one-time, to more targeted engagement and asks of previous one-time supporters, to a time-intensive but long-term strategy of branding a monthly giving program and providing those who opt-in specialized content.
Even beyond recurring giving, nonprofits can work to create other moments of giving throughout the year by scheduling their gala or seasonal event sponsorship opportunities outside of the year-end rush. For nonprofits with fiscal years that end on July 1 or another time, consider a push for donations to line up with the fiscal year-end. Regardless of whether you’re ready to make a significant strategic change, we’ve seen clients excel when they’ve built in time in January to focus on donor retention, thanking and strategizing on donor engagement as a follow-up to giving season.
For individuals, taxes owed can play a significant role in personal philanthropic strategies. People often wait until year-end to ensure that they are minimizing what they owe Uncle Sam by re-allocating income to causes that are meaningful to them. However, data suggests that individuals who build an annual philanthropic budget based on prior year giving are more comfortable making donations year-round. In order to maintain a flexible giving approach, you can include a cushion as part of the budget that you may or may not release at year-end depending on the financial situation. One vehicle to facilitate this year-round giving approach is a donor advised fund (DAF), where a single tax-deductible contribution is often made at year-end but donors can direct the fund to distribute its proceeds to nonprofits year round.
For businesses who want to make giving part of their organizational culture, one thing to consider is how best to engage your employees in a culture of philanthropy. At Trepwise we provide a philanthropic match for each employee, encouraging them to give to nonprofits to access the company match. Beyond just financial resources, we know that one of our most valuable things we can offer is our services. In our case that involves consulting hours, and as part of our Trepwork for Good program we allow employees to donate “free” hours to organizations and projects that they care about. Each company and organization should think about the product or service they offer and consider how they can use it to be part of their strategy to give back to the community, and get their teams involved and invested in the process. Any company can foster a culture of philanthropy. And in doing so, they can encourage a company culture that celebrates and emphasizes year-round engagement with community organizations.
Being philanthropic has no season. There is a good reason to give every month. For nonprofits, tapping into a network of monthly donors and giving moments throughout the year can reduce reliance on an end of year rush. For organizations, helping to cultivate a culture of philanthropy among your employees can play a meaningful role in providing a base of year-round support. Trepwise’s vision is a world filled with thriving and equitable communities nourished by good ideas. One part of the puzzle is creating sustainable funding strategies for organizations working to realize that vision – and that starts with diversifying patterns of philanthropic giving.
