Philanthropy In 2025: Trends, Opportunities, And Strategic Shifts

Created By: CJ Orr
December 2, 2024

Philanthropic Giving Will Grow in 2025: Seize the Opportunity

My outlook for philanthropic giving in 2025 is bright. With the economy growing and inflation stabilizing, charitable giving is expected to follow suit. Historically, periods of economic expansion have correlated with increased philanthropic activity – just look at 2016, when similar conditions and new administration policies led to surge in giving. While this is my personal perspective, I anticipate we’ll see a similar trend in 2025.

But it’s not just the economy that will drive philanthropy this year. I believe that societal motivations will also play a significant role. Changes in political administrations often inspire individuals and organizations to give more generously. Nonprofits should be ready to capitalize on this moment by amplifying their fundraising efforts and making bold asks.

The Perfect Time for Campaigns and Major Fundraising Initiatives

If your organization has been waiting for the right time to launch a campaign or a significant fundraising initiative, I believe that time is now. Several factors signal a green light for aggressive fundraising in 2025:

Economic Indicators: Rising consumer confidence and stabilized inflation mean more disposable income for giving.

Stock Market Strength: A strong stock market often correlates with increased giving, especially among wealthier donors who benefit from appreciating assets.

Tax Policies: Current tax laws incentivize giving, making it easier for donors to support nonprofits while reducing their tax burden.

Generation Transfer: We’re in the middle of the great wealth transfer and planned giving is a major part of any campaign.

Major Gifts: They are on the rise and a campaign is reliant on major gifts to be successful.

Organizations that move decisively will be well-positioned to secure transformational gifts. Building urgency and making a compelling case for support will be critical.

Inflation Has Cooled Off, So Expect a Return of Mid- and Lower-Level Donors

While major donors continue to play a vital role in driving philanthropic growth, 2025 offers an opportunity to re-engage mid- and lower-level donors. Inflation’s leveling-off has allowed for a growth in disposable income, making it easier for average donors to contribute again. If you can, beef up your mid-level giving and online giving programs, they will have a good return in 2025.

Leveraging AI and Automation for Fundraising Success

The rise of AI and automation is revolutionizing the nonprofit sector, and really the entire economy. In 2025, these technologies will continue to drive a productivity boom, enabling organizations to work smarter, not harder. AI-powered tools can enhance donor prospecting, streamline communications, and optimize fundraising strategies, freeing up staff to focus on high-impact activities.

Here are some of our top recommended AI tools: LLMs (ChatGPT), Grammarly, Version2, Copilot, Gamma, Zapier or Make, and DonorSearch AI.

The Decline of Corporate DEI Commitments

Corporate giving to DEI initiatives has been on the decline and is expected to continue decreasing in 2025. While Orr Group acknowledges this trend, we do not support it and remain supportive of DEI initiatives.

Recent events, such as the Fearless Fund case and changes to affirmative action laws, have contributed to this decline, leading many companies to scale back their DEI commitments.

Given this reality, nonprofits with DEI-focused programs should consider shifting their fundraising strategies toward individual donors, who represent the majority of philanthropic giving. According to Giving USA, individuals contributed 67% of all charitable donations in 2023, compared to just 7% from corporations. Given this significant disparity, organizations should prioritize building relationships with individual donors and crafting narratives that resonate on a more personal level.

Expect Work-Life Culture to Change at Nonprofits and Businesses at Large

Given the new incoming administration and the articles that have been circulated about the administration’s agenda, nonprofit organizations should brace for cultural change. While keeping unemployment low is a core objective of the Fed and others, we can anticipate new policies from the upcoming administration that prioritize less focus on work-life balance, remote work, and DEI-centered business practices.

At Orr Group, we remain committed to fostering inclusive, equitable, and flexible work environments—values we believe are essential to organizational success. While these anticipated shifts may influence how nonprofits operate moving forward, our role is to help organizations navigate these changes thoughtfully and strategically, ensuring they continue to prioritize their core values and missions in the face of evolving external pressures. To stay ahead, organizations should begin reassessing their strategies and preparing for the changes to come.

Employment and The Search for Talent

The Fed will always prioritize maximizing employment, aiming to maintain the unemployment rate around 4%. This indicates that the job market for top talent will remain competitive. To stand out, organizations must develop a compelling Employee Value Proposition (EVP) that highlights their values, benefit offerings, work environment, and culture. By focusing on what makes your organization unique, you can better attract and retain the right talent. Orr Group has found that producing a tailored EVP in advance of searches is one of the most effective methods for navigating this competitive landscape, helping organizations connect with candidates who align with their mission and needs. Whether partnering with a search firm or building in-house capacity, creating a strong EVP is critical to success in today’s job market.

Major Gifts and Planned Giving: The Cornerstones of 2025

In philanthropy, the Pareto Principle remains as relevant as ever: 80% of your results (gifts) will come from 20% of your efforts (donors). In 2025, this dynamic will become even more pronounced, with major gifts accounting for an increasingly significant share of total donations. Nonprofits should focus their resources on cultivating high-net-worth individuals who have the capacity to make transformational gifts.

At the same time, planned giving represents a massive opportunity. The ongoing great wealth transfer—expected to exceed $84 trillion over the next two decades—will continue to reshape the philanthropic landscape. Baby Boomers, many of whom are passionate about legacy giving, are passing their wealth and values to the next generation. Nonprofits should invest in planned giving programs that educate donors about the benefits of including charitable gifts in their estates.

The Power of Donor-Advised Funds (DAFs)

Donor-advised funds (DAFs) remain a growing force in philanthropy. Recent statistics show that over $250 billion is currently sitting in DAFs, awaiting distribution to charitable causes. Nonprofits must develop strategies to access these funds, often requiring proactive donor engagement.

A common question from organizations is, “How do we encourage donors to disburse funds from their DAFs?” The answer lies in creating a sense of urgency. Communicate their gift’s immediate impact and demonstrate how their money can be put to work today to achieve meaningful results. Personalized appeals and clear examples of impact will be key to unlocking this vital funding source.

Conclusion

The trends shaping philanthropy in 2025 offer some real opportunities for growth and innovation. With the economy thriving, donors of all levels are poised to give more generously. Organizations that embrace bold fundraising strategies, leverage emerging technologies, and adapt to shifting donor dynamics will be well-positioned to succeed.

By focusing on major gifts, planned giving, and re-engaging mid-level donors, nonprofits can build a sustainable pipeline for future growth. At the same time, leveraging AI and targeting donor-advised funds can help maximize efficiency and impact. As the philanthropic landscape evolves, now is the time to act decisively and seize the opportunities ahead.

The year 2025 holds immense promise. Let’s make it a year of transformational giving and meaningful change.

Orr Group’s unique approach involves applying a business mindset and understanding of current and anticipated philanthropy trends to design successful and sustainable fundraising strategies. Get in touch with us today to learn how we can help you raise more money effectively.

CJ Orr is the Chief Executive Officer of Orr Group. As an expert project and relationship manager with 10+ years of experience in the sector, CJ utilizes data, technology, and financially-backed trends to execute on the development of strategies and tactics to drive effective fundraising plans that meet or exceed targets.