Higher Education Raises $46.73 Billion in 2018
According to the recently released 2018 Voluntary Support of Education (VSE) Survey, charitable support of colleges and universities reached $46.73 billion in 2018, up from $43.6 billion in 2017, a 4.6 percent increase when adjusted for inflation. This included a notable increase in gifts from “other organizations” – a 10.5 percent increase from 2017, after adjusting for inflation, largely attributable to contributions to Donor-Advised Funds (DAFs).
The strong stock market contributed to colleges and universities receiving the largest annual amount in charitable contributions to date between July 1, 2017, and June 30, 2018 (with a few institutions reporting on different fiscal calendars). This fiscal year, seven different institutions received gifts of $100 million or more – the highest number of distinct institutions to receive gifts of this size in a single year.
Here are a few ways that you can apply this data to your organization’s strategy for the coming year:
- Understand and leverage donor-advised funds. They’re not going anywhere anytime soon.
Of the 871 institutions surveyed in this report, 404 answered an optional question about DAFs – reporting that contributions from DAFs increased 65.8 percent in dollar terms over the last fiscal year. This increase may be credited in part to the tax benefits some donors were able to receive within the 2017-2018 fiscal year, prior to the changes made to those benefits through the implementation of the 2018 Tax Cuts and Jobs Act.
The reality is that DAFs are not going anywhere. Now is the time to ensure your shop’s systems and procedures are fully equipped to handle contributions from DAFs. Furthermore, your organization should review their existing strategies for these gifts and implement a plan for increasing them. This could involve promoting the option to give from a DAF in all solicitation materials, or developing marketing appeals that stress that your organization’s acceptance of gifts from DAFs. Some organizations are looking to establish DAFs within their own enterprise; often partnering with a local community foundation who has the infrastructure to administer such funds. Another vital step that all organizations should be taking is making sure that your gift officers and staff are well-equipped to help donors make gifts through DAFs to your organization. Providing your team training and talking points about gifts through DAFs will ensure that they are maximizing philanthropic potential. Donor-advised funds represent a tremendous opportunity for your organization, if you are positioned and equipped to harness this growing force in our industry.
- Focus on relationships now – prepare for economic shifts before they arrive.
The United States is currently amid the second-longest economic expansion in its history, a possible indicator that the bubble is soon to burst. A recent report from Deloitte notes that 55 percent of the 147 CFOs surveyed expect a recession by the end of 2020. While we can’t know exactly when a recession may occur or how the new tax laws may impact future giving, this lack of clarity is an instruction to prepare for anything.
If your organization’s mission and the relationships are solid, you can rise above the ever-changing tides of the economy. To get an idea of how your donors have responded to different financial contexts, examine your historical giving data in relation to national economic trends. This information can support a relationship-building strategy for ensuring that your constituents feel supported within any economic context. There is always time to do the important work of telling your story, building stewardship programs and deepening your connections.
As you continue to plan for 2019 and beyond Bentz Whaley Flessner can help you develop strategies pertaining to these findings and trends to prepare your program for the future.