“Crystal Ball” Prediction for Foundation Giving 2024: Inflation

This is the third of a six-part series on 2024 prediction for foundation giving. If you missed part 1 or 2, you can still check it out here. In this series, Millionaire Grant Lady and Associates are sharing our insights into foundation giving. These predictions are based on the most up-to-date information available as well as our in-the-trenches work with our nonprofits. To date, we have won more than $103 million in funding for our clients. Every day, we use these insights to win more dollars for a wide variety of organizations all across the United States, and these insights can help increase your funding, too.

If you have paid attention to the price of housing, food, gas, utilities, healthcare or any other essential over the last few years, you know that prices seem to be going up and up. Inflation means that what we could have bought with $10 a few years ago now costs $15 or $20 today. This is impacting everyone’s bank accounts, including the bank accounts of nonprofits and foundations.

How will inflation impact foundation giving?

While the stock market is a good indicator of the return on investments for foundations (and everyone with a retirement account), it does not necessarily tell the whole picture.

In 2022, based on 990 data–remember this is the most recent 990 data we can get– foundation giving was up compared to 2021 in terms of dollars but down significantly in terms of inflation (around 10% according to Giving USA 2023: The Annual Report on Philanthropy of the Year 2022).

We all understand what inflation means for our bottom lines. When the prices of everything are going up, we need more money to provide the same services compared to a few years ago. For a lot of nonprofits, this has meant they have had to delay introducing new programming or they may have even cut budgets or reduced staff to ensure that core programming remains stable. Nonprofits have also been asking for more money to meet the increased demand for services and the cost of providing those services. The end result is we either need more money to keep doing what we’ve been doing, or we have to tighten our belts.

Inflation impacts foundation giving as well. Foundations are likely receiving larger asks from more nonprofits because nonprofits need more money to fund their mission-driven work. To help foundations handle the influx of applications, we have seen more foundations move to not accepting applications from new organizations, and we have seen an increase in foundations issuing statements that say they have met their funding capacity for a given time frame. This is showing us that foundations, too, are feeling the crunch of inflation. More people are asking for more money, and with a volatile stock market, there is not always more to give. This is our third prediction for foundation giving.

Prediction 3: Grant winning will become more competitive in 2024 with more organizations asking for more money. Further, organizations will have to devote more time to fundraising due to more rigorous application processes. If you need help meeting your fundraising goals, we are here to help.

Did you miss part 1 and 2? Don’t worry, you can still check them out here.