American Generosity Reaches a Record High
With a record $390 billion in charitable giving in 2016, donors continue to demonstrate
their belief in the work of nonprofits through increased giving. Increasingly,
that giving is being driven by high-net-worth households.
Giving USA reports that charitable giving from individuals, corporations and foundations in the United States reached a record total of $390.05 billion in 2016. Published annually since 1956, Giving USA is the longest-running and most comprehensive report on philanthropy in the United States.
Turns Out, It’s Not the Economy
Despite political uncertainty and economic concerns in 2016, Americans continued to be generous — increasing charitable gifts by 2.7 percent over 2015. For only the sixth time in the last 40 years, giving increased in all philanthropic sectors: education; human services; giving to foundations; health; public-society benefit; arts, culture and humanities; international affairs; and environment and animals.
Individual Giving Outpaces Foundations and Corporations
Giving from individuals continues its strong upward trend, from $214 billion in 2011 to $282 billion in 2016 — an increase of 32 percent in five years. The Giving USA report reveals that giving by individuals grew at a higher rate (3.9 percent) than the other sources of giving, outpacing giving by foundations and by corporations, and offsetting the sharp decline in bequests. Giving by foundations rose more slowly in 2016 (3.5 percent) compared to the stronger increases seen in recent years.
In addition, corporate giving increased modestly in 2016 (3.5 percent), in the wake of slower GDP growth and little movement in the share of pre-tax profits directed to giving. Giving by bequests fell sharply (-9.0 percent), following two years of strong growth. Gifts in the form of bequests frequently fluctuate from year to year and are less influenced by economic factors.
Insights for Westfall Gold Clients
Despite external factors, Americans, and in particular those who attended our Major Donor Events, continue to demonstrate their belief in the work of nonprofits through increased giving. Westfall Gold clients have seen average contributions at our signature events increase from $51,000 to $75,000, or 47 percent, in the five-year period between 2011 and 2016. In 2017, contributions at Westfall Gold Major Donor events have averaged $115,000. This reflects significant improvements in our model, especially in wealth analytics, invitation strategy and content development. The Giving USA report also noted that individual giving may be increasingly driven by high-net-worth households, and that new and upgraded donors showed promise in 2016, even while donor retention continues to weaken. In light of this, Westfall Gold clients should continue to focus on the major donor event not only as a retention device, but a key strategy for acquiring new and upgraded donors.