Monthly giving and how it can boost annual giving

by Sara Lundenberger, director of nonprofit consulting | Feb 25, 2019 |

Consulting, Fundraising, Nonprofit operations |


Fundraisers and nonprofits are always looking to find a way to raise more annual donations. The best way to do this is either to attract more donors or increase the amount each donor gives.

Simple, right? Not really – especially if you only focus on the big picture of annual giving.

For my blog post this month, I am going to focus on giving that plays into and boosts annual giving. And I am going to tackle a topic that gets a lot of attention – recurring giving and, more specifically, monthly giving.

Recurring donations are set up by the donor to pre-determine their giving. Donors can give monthly, every other month, quarterly or whatever nonprofits set as their internal parameters. Of recurring donations, monthly giving is probably the most common.

Monthly giving is a hot topic because there isn’t a lot of data surrounding it; however, we do know a few things:

⋅ Monthly donors give 42 percent more each year than one-time donors.
⋅ Monthly giving increased by 40 percent overall in 2017.
⋅ Revenue from monthly giving grew 23 percent compared to a 13 percent growth for one-time giving.
⋅ Monthly giving was only 16 percent of online revenue in 2017, but it’s growing.

Despite the fact that monthly giving is growing, many nonprofits don’t have the internal structure set up (yet) to accept recurring donations. Others don’t know how to let their donors know it is an option. And some simply do not know where to start when it comes to monthly or recurring giving.

Still, if your nonprofit is interested in learning more about monthly giving, here is some information you need to know:

How to set it up

There are a few different ways to collect recurring donations. Donors can sign up online with a credit card that gets charged each month, send in a check every month or set up a direct deposit directly from their account to yours.

Some donor management systems can collect and keep track of your monthly donors for you. Check your online form for the ability to add this as an option. If your system cannot track this on its own, you aren’t out of the monthly giving world, but it will take a little more time and coordination between you and your accounting department to figure out the best way to track and charge these donors every month.

Also, make sure your accounting/finance team approves your ideas before you start promoting them. This should be easy and run like clockwork, not something that takes up a lot of you or your team’s time.

Who are most likely to be monthly donors?

While you might think that millennials are more likely to give through a monthly giving program, the stats don’t support the theory. In actuality, 49 percent of Gen X donors and 49 percent of baby boomer donors give monthly, while only 40 percent of millennials donors give monthly. The positive side of these statistics is that almost all your donors are willing to give monthly if they are asked.

Board members are also great candidates for monthly gifts. Add it as an option on their pledge form or ask them at the first meeting of the year. Monthly giving is a great way to involve board members that have not either been engaged with the organization or given a yearly gift.

So, how do you ask?

Make sure your organization is giving donors the option of turning every gift in to a monthly gift. Offer the option on your online giving form, annual appeals and other asks.

On average, recurring gifts tend to be larger if you suggest gift amounts. Make sure the gift amounts are small enough that donors will feel comfortable enough giving that amount each month, but large enough that you aren’t wasting administrative time on $5 gifts.

Promote the option on your website or even do a special mailing targeting possible monthly donors. Use your social media and tie the amounts of monthly gifts to something important to your organization. Donors like to see where their money is going and, if they can see their monthly gift making a bigger impact, they are more likely to sign up and never cancel it.

If you do some sort of phone-a-thon, monthly gifts are a great way to convince your donors of making a huge impact a little bit every month. A $25 monthly gift quickly turns into $300. This might be a stretch for a one-time gift – but not a monthly gift. The key is to show your donors how much more of an impact their gift might have if they gave more throughout the year instead of one large gift.

There is a very good reason nonprofits are starting to promote and urge their donors to give monthly. Monthly giving gives your donors some predictability with their donations. Many of our donors live within a strict budget, so providing them the opportunity to support their favorite nonprofits in smaller amounts might be easier than one large gift.

Additionally, most monthly donors continue to give for longer periods of time. Very rarely does a monthly donation get cancelled by a donor, which is great news for your nonprofit. The retention rates for monthly donors is also higher than your annual donors, so not only are you raising more money each year, you are keeping your donors longer. This leads to higher revenue.

Monthly giving is not just beneficial to an organization and its donors in the short-term. It is impactful year-round, makes a difference in the long-term and, overall, plays a huge part in the bigger picture of annual giving for organizations.

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