What a Possible Recession Means for Fundraising

Mara Anderson

On June 22, I attended a webinar by Patrick Schmitt, co-CEO of FreeWill. Mr. Schmitt provided insight on “What a Possible Recession Means for Fundraising” and advised nonprofits on how to generate mission-inspired funds. Specifically, he addressed:

• Insights into recession fundraising impact
• What makes 2022 different
• Impact on the stock market and crypto for donors
• Strategies for nonprofits to fundraise effectively

Mr. Schmitt defined a recession as “a significant decline in economic activity that lasts for months or years”; some economists require a recession to have “two or more consecutive quarters of declining GDP.” These economic fluctuations are “unavoidable” and cyclical in nature. Over the past 30 years, Mr. Schmitt explained, the U.S. has gone through 4 recessions.

Through their research, FreeWill and Mr. Schmitt have the following insights for nonprofits navigating a recession:

• Donor giving decreases
• Donors prioritize what’s important to them
• The percent of income given to charity is fairly consistent
• Participation rates decline
• Not all donors are impacted the same

With this foundation in mind, Mr. Schmitt encourages nonprofits to fundraise effectively by:

• Making the most of new donor psychographics
• Don’t let the news fool you
• Don’t forget about DAFs
• Remember that planned giving is non-cyclical
• Invest in donor relationships

Ultimately, the webinar ended on a positive note: “It’s go time for this community.” Donors still want to help causes they’re passionate about. If you’re a nonprofit looking for fundraising management advice, we’re here to help.