It is no secret that 2020 was a troubling year, and the philanthropic sector was resilient amidst a variety of new challenges. Innovations were conceived and implemented to ensure both fluidity and longevity as we move into the equally unpredictable 2021. That said, here are a few key lessons we learned during 2020.
The resilience of generosity
When the pandemic started, many nonprofit leaders were worried that the resulting economic crisis would bring their organizations to a halt. It was a scary situation. The entire restaurant sector was being shut down indefinitely. Lockdowns were being imposed and unemployment was skyrocketing.
It’s easy to see why this unprecedented situation would spark fear. But in fact, the opposite thing happened. Giving increased in the first half of 2020 by 5%. Another piece of good news was that there were 12.6% more new donors giving. So not only was the nonprofit sector able to avoid layoffs and service cuts, but an expansion was possible as well.
Why did donors increase contributions? People are complex and psychological studies are still being done. Perhaps they felt fortunate. Many hot-button issues needed to be addressed as well.
Donor-advised funds are great for rainy days
All donor-advised fund money must go to charity eventually but the timetable is up to the donor. It basically serves as a rainy day fund for society. Since expenditure is flexible, the account holder can choose to contribute until needs are great. 54% of nonprofits saw increased gifts from donor-advised fund accounts during this time period.
Small donors still count
There was a 55% increase in donations from small donors. Big donors give to big philanthropies who are often national. There is a need to enlarge the group of Americans involved in charitable giving. Smaller organizations working within communities depend more on local small donors.
2020 was a cataclysmic year with multiple crises. Philanthropy proved to be resilient. Numerous lessons can be learned from this time period.