Does High Inflation Make You Fear for Your Fundraising Efforts?

There’s no doubt. Nonprofit organizations face fundraising challenges that they have not seen for decades. Nevertheless, opportunities remain even as the latest economic news has not been good:

Consumer Sentiment: The University of Michigan Consumer Sentiment Index for March 2022 reveals that consumer confidence has plummeted 25.5 percentage points compared with March 2021. At 59.4 percent, the consumer sentiment index now stands at the lowest point in two decades. This is not surprising given economic conditions. Unfortunately, it means people will now be especially careful with their personal finances.

Uncomfortable Inflation: Treasury Secretary Janet Yellen predicts another year of “very uncomfortably high” inflation. In March 2022, the annualized inflation rate stands at 7.9 percent, a 40-year high. What’s even more troubling is that by calculating the Consumer Price Index now, using the same formula used in 1980, the inflation rate would stand at over 15 percent! The following chart from Shadow Stats illustrates this point:

Consumers Face Increased Expenses: The average American household is facing nearly $300 in higher monthly expenses due to inflation, according to Moody Analytics. Households in rural areas may face even greater monthly costs as fuel prices rise. This will likely negatively affect current philanthropic giving. While individual charitable giving usually comes in around two percent of disposable income, according to Giving USA, we’re now seeing the erosion of household disposable income.

Inflation May Not be Our Only Problem: Inflation is not our only reason for economic concern. Former US Treasury Secretary Lawrence Summers has not just expressed concern about inflation, he’s worried that US Federal Reserve policies dealing with inflation could lead the economy into a recession.

Despite all of the bad economic news lately, we’re fortunate that not all of the news is bad:

Fundraiser Becomes Charity Recipient and Gains Renewed Perspective

These are tough economic times. Everyone knows this. Many who work in the nonprofit sector have seen the demand for services increase greatly during these challenging times. But, we have experienced events as nonprofit managers, development professionals, volunteer leaders, professional advisors, or consultants. Recently, I heard from one of my readers who has a different perspective. S/he is a development professional who lost her/his job and is now a recipient of charity services. It’s a bit like the Hollywood cliché of a doctor who is suddenly struck by an illness and learns what it’s really like to be a patient.

On this blog site, I’ve written from the perspective of the development professional. I’ve even written from the perspective of the donor. However, until now, I’ve never posted anything from the perspective of the recipient of a nonprofit organization’s services. So, I invited my reader to share her/his thoughts from her/his special perspective. For reasons that will become obvious, I am protecting the writer’s identity, even going to the point of confusing the pronouns. I hope you appreciate the insight:

 

The truth is I’m just another statistic.

I am an experienced fundraiser who has worked for a few organizations over the last decade. I have had major successes and yes, like everyone else, some failures. I enjoyed my work — knowing that the funds I raised were going to help people who were poorer than I, less educated than I and, in general, did not have the opportunities I did.

And then I lost my job. Yup, a gut puncher if ever there was one.

But rather than dwell on the negative, I saw it as an opportunity. You never know what lies over the horizon.

My biggest problem was how to support my family. Nonprofit salaries are not, shall we say, going to get me on Robin Leach’s Lifestyles of the Rich & Famous (remember that show?). We had no savings and pressure was on to find a job quickly.

That didn’t happen.

Instead, things got very tight in a hurry. The little unemployment compensation I could collect did not pay the bills. I can’t go to friends since they’re maxed out and have their own issues. Family? Forget it. So now, we scramble to find who to turn to.

In our community, there is a Free Loan Society. This society helps families who are having financial troubles and need a little “breathing room” for a few months. The amount isn’t that much, a max of $500 per month. But, if it helps with food shopping…

We had a very tough decision to make. I have always worked in nonprofits and money has always been an issue, but we never took charity. And yet, now we were faced with unpaid bills, mortgage payments and everything that millions of jobless people face daily.