Giving Trends: The Past Forty Years

By Sandra Kidd

The year 1972 was a very big one. Innovations were created and events occurred that would greatly influence the future of our country.

In the technology world, the compact disc was introduced by the RCA Company, the first video disc was released by Phillips, the video game market was launched by Atari, and a pay cable company called HBO debuted.

All of these terms and names are familiar, and may almost seem “old” to you now.

Politically, we watched President Nixon go to China, followed by some of the President’s men caught on a little trip over to the Watergate.

Financially, we used first-class stamps that only cost eight cents, and $9,700 was the average household income.

For our entertainment, we went to the theatre and watched The Godfather, while we took a weekly TV visit to Korea with M*A*S*H* from our couches.

It was also an important year for the philanthropic world. Our colleagues at the Indiana University Lilly Family School of Philanthropy, along with the Giving USA Foundation, have gathered and examined overall giving trends since 1972.

The Giving USA report is the longest-running annual report on charitable giving trends in the United States. Published annually, this year’s report shows us the charitable trends in 2012, as well as the combined overall giving trends for the past 40 years.

The information and lessons we have learned in giving trends can help you improve your fundraising.

These three trends stand out as influential:

  1. American giving is largely dominated by gifts from individuals. Eighty-nine percent of all giving in 1972 was made up of individual giving from donors and donor bequests. In 2012, individuals gave 80.5 percent. The time you spend with individual donors should match this percentage of giving. This means you and your development team should spend about 80 percent of your efforts focused on the individual. If you are not already doing so, it might be in your best interest to reexamine where your time is spent and the results that come from that time.
  2. Foundation giving has doubled. As a percentage of all gift dollars, foundation giving has more than doubled during the past 40 years. In 1972, it was at six percent – last year it was at 14 percent! A giving trend in recent years has fueled this growth: High net worth individuals have begun to channel their giving to personal or “Family Foundations,” which, as estimated by the Foundation Center, account for nearly half of all foundation giving. What we can learn from this shift is you still need to focus efforts on individuals, because they are the ones giving to the foundations.
  3. There are a large number of organizations that need charitable dollars. At the end of 2012, there were 1,081,891 registered 501c3 nonprofit organizations in the United States. What this means is, while Americans are very generous donors ($316.23 billion was given away in 2012), there is steep competition amongst charitable organizations for your donors’ dollars. To achieve and sustain results requires you and your Board to remain competitively focused on fundraising and donor retention.

As much as things change, they still remain the same…even 40 years later.