Chapter 1Increased Complexity and Mounting Challenges: Time to Prepare

Not-for-profit entities (NFPs) should be riding high, according to a recent Giving USA Philanthropy,1 charitable giving reaching an all-time high in of $390 billion. This included the millions of dollars, donated to Planned Parenthood, Meals on Wheels, the ACLU and others, which were received just days after potential federal budget cuts were announced. Although these gifts could be considered one time reactions to current events, contributions are still up from prior year levels. The bull market is strong, inflation is low, hovering right around the 2 percent mark, and interest rates are still very low.

However, this good news does not tell the whole story for most NFPs. The Blackbaud Institute’s Charitable Giving Report2 (Blackbaud Report) provides additional insights into the risks that many NFPs will encounter if they have not adapted to the mounting challenges brought about by generational changes, donor preferences and requirements for transparency and communication. The Charitable Giving Report showed that generations X and Y are approximately 57 percent of the U.S. population but make up only 26 percent of the donor population and contribute around 20 percent of the dollars. Generations X and Y also tend to give to fewer nonprofits than the Baby Boomers or Silent Generation did. The younger cohorts ask more questions and expect to know how the funds will be used. They are also interested in statistics ...

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