2023 Charitable Giving Outlook

In the face of economic uncertainty, 9 in 10 Americans who donated to charities in 2022 plan to do so this year, and many hope to help their own communities by prioritizing local causes.

After several years of economic uncertainty and inflation, 2023 hasn’t been kind to American consumers. People are finding it harder to handle household expenses and debts as interest rates climb, and concern about an approaching recession is causing stress for many.

In these challenging times, however, millions of Americans still prioritize generosity and find ways to contribute to nonprofits and charities with their hard-earned money. To determine how the economy impacts American donors and their attitudes toward giving, we asked nearly 1,500 people about their plans to give in 2023 and their motivations.

Key findings from our research:

• 39% of American adults said they donated to charity in 2022, and about nine in 10 plan to give again this year. In other words, there may be a slight decline in the number of donors in 2023.
• The typical American donor gave $400 to charity last year, but this year the typical person plans to give about $300. However, more people plan to volunteer with or donate physical items to nonprofits this year.
• The decline in financial giving could be due to rising economic worries and challenges: 68% of Americans say finances are tight and plan to cut expenses in 2023.
• As financial concerns rise in the U.S., Americans are more interested in helping their communities by donating to local or domestic causes over international ones.
• Nearly 2 in 3 donors said they are more likely to buy a product if part of the proceeds goes to charity and felt supporting businesses that donate to charity is important.

How Many Americans Donate to Charity and Nonprofits?

Nearly 40% of American adults made at least one financial donation to charities in 2022. Older adults in the Baby Boomer and Generation X generations were likelier to have made donations than Millennials and Generation Zers.

Older Americans may be better positioned to give for a few general reasons:

• Older adults tend to have more disposable income and higher spending capacity than younger adults. This is because they have had more time to save money, and they are often no longer paying for things like childcare or college tuition.
• Older adults often have more free time than younger adults. This is because they are no longer working full-time or raising children. Many use this free time to volunteer.
• As people age, they become more interested in leaving a legacy. This can lead to a greater sense of empathy and compassion for others. They may feel a desire to give back to the community or to help those who are less fortunate.

Generation Zers were least likely to have donated last year, but they could become the most generous generation as they age. Experts say these young adults are the most likely to donate out of principle and give when they can simply because they feel it’s just the right thing to do.

In addition to making financial donations, many people donate their time to charities/nonprofits through volunteering. More than half of donors plan to donate items, such as clothing, bicycles, or food, this year.

According to our research, there may be a slight decline in many forms of giving in 2023. Most notably, fewer people plan to make online donations this year than last year. However, more people plan to give their time through volunteering. Many other giving methods will remain roughly the same this year, such as gala attendance, workplace payroll deductions, and donating gifts in kind.

Economic Impact on Charitable Giving

One of the factors affecting Americans’ attitudes toward giving is the state of the economy. Though many American adults have recently made generous donations, 63% say the current state of the economy is causing them significant stress. Also, 68% of our respondents said their finances are tight and plan to cut expenses in 2023. For some, this will mean buckling down on charitable donations.

While rumors of recession and lingering inflation won't halt donations completely, charities and nonprofits will face declines in donations as well as the number of their donors. Last year, the typical American adult donated about $400 to charity, but they only plan to give about $300 this year.

Though the median yearly donation amount is projected to decline, most people are planning to continue to give even in the face of financial stress. About nine in 10 people who made financial contributions to charity in 2022 plan to do so again in 2023. Economic stressors will most impact those in the lower income groups, but many still plan to give.

How much do you plan to contribute in financial donations to charitable organizations in 2023?

By income level

Although financial giving may be down this year, 43 percent of donors said they plan to give more time and goods to charities this year compared to last. Though people may have less capacity to give financially, they still want to support causes they care about in other ways.

There are several reasons why Americans still love to give back, even in a challenging economic climate. Many people believe that, as a principle, it is important to support causes that they care about generously. Others may have benefitted from the work of community organizations and charities in the past, so they may want to return the favor and help others receive support and assistance. Still, others may give for religious or political reasons.

Key Considerations for Charity Donors

Now that we’ve established that financial giving may be down slightly in 2023, it’s up to charitable and nonprofit organizations to strengthen trust with loyal donors while cultivating relationships with prospective donors.

In 2023, what are some of the best ways to do this?

First and foremost, people rely strongly on personal recommendations from friends or family members when discerning where to make donations. They want to be able to trust their money will be put to good use, and having a personal recommendation can go a long way in establishing trust with a charity or nonprofit organization.

Additionally, many other people first encountered nonprofits and charities on social media before making donations. This shows how essential it is for nonprofits of all sizes to be present on social media. While this may be challenging for smaller charities or those without marketing staff, these results show how worthwhile it can be to establish social media profiles.

In-person events hosted by charities and direct mail campaigns were also common ways donors heard about the organizations they support. This shows how important it is for charities to diversify their outreach strategies, harnessing both digital channels and more traditional tools like events and mailers, depending on the demographics of their donor bases.

Since it may be more challenging to reach new and established donors in 2023, it’s important to understand how they discern which organizations to support. Nearly nine in 10 donors said they consider charities’ missions and overall reputations before making donations, and almost three in four consider their personal connections to various causes when giving. For example, cancer survivors may strongly desire to donate to cancer research, and teachers may want to contribute to organizations that improve educational outcomes.

Forty-four percent of donors also considered organizations’ financial efficiency and overhead rate when making donations. In fact, about a quarter said they often or always review a charity’s financial statements or ratings before giving. This will become even more important to people in uncertain economic conditions because donors want their hard-earned and generously-given money to be used efficiently and responsibly. Organizations need to be as transparent as possible with their financial reports to build trust with donors.

On the other hand, some donors may feel the overhead rate (the percent of spending on administration, fundraising, accounting, human resources, etc.) is the most telling sign of a charity’s efficiency and financial responsibility. However, donors should understand that overhead spending is necessary as it pays for essential staff and services to keep the nonprofit running, growing, and improving its services.

Most Popular Causes Among American Donors

Thanks to social media and 24-hour news coverage, people are highly aware of the crises happening around the world. For nearly every challenge people face globally, many charities are working to help.

Since people today are inundated with appeals to help people in crisis from every corner of the world, how do they choose which to support financially? Are Americans putting local problems first, or are they more likely to be moved by international causes?

Forty-six percent of donors said they’d prefer to support local causes in their city or region with charitable contributions when given the option. These local organizations include homeless shelters, food banks, animal shelters, domestic violence shelters, and places of worship.

By comparison, 23% said they’d prefer to make a global impact with their donations. Examples of international causes are poverty alleviation, refugee assistance, wildlife conservation, disaster relief, and climate change initiatives.

People may be more enthusiastic about supporting local causes today for many reasons. They might want to donate locally to see and benefit from the progress being made by their donations. Others may have greater empathy for people in need in their own communities.

While the percentage of people planning to give this year to each cause is down, the most popular are domestic needs and environmental- or animal-related causes. Environmental issues in particular may be of great concern to Americans as the realities of climate change become more noticeable and urgent.

Leslie VanSant, vice president of philanthropy with the Rainforest Trust, has also noticed this trend in recent years. The organization works to protect habitats and endangered species around the world. “In today’s economy, [donors] might give smaller gifts or less frequently, and are really choosing causes that are important to them," VanSant explained. “With climate change and species loss, Rainforest Trust’s mission has never been more urgent. Our commitment to transparency shows people that their generosity is having an impact."

The top causes for each generation of givers also differed, with older Americans prioritizing domestic needs and the younger generations favoring health and youth causes. Since Generation Zers are closest to their own childhoods, they may feel most connected to supporting young Americans. On the other hand, millennials may be most likely to prioritize health organizations for several reasons: their health outcomes are poorer than generations past, and they feel access to reproductive healthcare services is essential for their peers.

Top 3 charitable causes by generation

Donors Want Their Regular Purchases to Support Charities

It’s not just individuals who love to make a difference with their dollars: an increasing number of for-profit companies also support nonprofits and charities with their revenue. As our previous research revealed, consumers love to support brands aligned with their values and beliefs.

In our latest study, nearly 2 in 3 donors reported being more likely to buy a product if the proceeds go to charity. A similar number say it’s important to them to support businesses that donate to charity.

Given this reality, partnerships between businesses and nonprofits could be mutually beneficial, especially in years when consumers may have fewer dollars to go around. Today, it’s not enough for brands to provide a quality product or service: they also need to show their customers their values and where they stand on important issues.

Tips for donating to charity

Charities and nonprofits are grateful for the support of their donors. They use the money that they receive to fund their programs and services. However, to make sure that American donors' donations and services go to the right cause and organizations, we have some tips that you can consider before donating to charity:

1. Do your research:

Before you donate to a charity, take your time to do your research on the organization. Check out their website and reviews, find out how much of your donation goes into the cause, and ensure that the organization is legitimate and genuine. You can check the charity's rating with Charity Navigator or GuideStar. Avoid rushing into donating, and make sure you are well-convinced before donating.

2. Consider donating your time or goods:

Although financial donations help organizations advance their missions, you can help in many ways. Not everyone can afford to donate money, but you can still help by volunteering your time or donating goods to a charity. Don't let your financial capacity restrict you from donating when you can donate goods and your time to helping a great cause.

3. Choose a charity you care about:

Donate to a charity that works on issues you’re passionate about. This enables you to donate money, goods, and time because you want and love to, not because others are doing it. It helps instill a sense of purpose in your giving and a deeper connection to the organization.

4. Remember, small gifts matter:

Even a small donation made regularly can add up over time. If you have $5 to spare, that can make a difference for people in need. Build a habit of generosity with small donations, which will make a massive impact throughout your life.

5. Shop with businesses that support charities:

Shopping with businesses that support charities helps your money go towards great causes, even if you don't have enough to make a separate donation. Knowing that a part of your  purchases of everyday items went to a charitable cause can help you make intentional choices when you shop - and could make shopping even more enjoyable.

We know the importance of businesses that support charities, so we recently launched Savings Cares. We’re giving back to causes you support by partnering with a new charity each month. This means you can make a difference just by shopping and saving with your favorite brands.

Our data

This year, in April 2023, we conducted a web-based poll of 1,485 people living in the U.S. on how the current economy has affected their giving back to the community and if their last year's giving act will reduce, remain the same, or increase this year.

Their ages, genders, ethnicities, and the generation they belonged to, were representative of the U.S. population. Among these people, 585 had financially donated to charities or nonprofit organizations in 2022. 502 of these donors answered more detailed questions about their planned giving in 2023 and their attitudes toward the current economy.