The June 12, 2008 issue of Newsweek reports on the coming charity crisis.
There is little doubt that the United States economy is struggling. Many sectors of the US economy are down: housing, banking, construction, finance. It all creates a ripple effect. Unfortunately, as Newsweek reports, many view charity as a luxury. The check to charity is what many do when the bills are paid.
For charities like the Salvation Army that rely upon the middle class as their key donors, they face particular difficulties. Rising gas prices are particularly hitting the middle class. This leaves them with less to give, or if they are giving, they do so sacrificially.
These difficulties face increasing challenge when coupled with weather related disasters. Storms in the midwest, flooding and earthquakes all tend to divert dollars. And for many donors it is not a question of additional giving. Instead, it is often an either/or approach. In other words, if they give for earthquake relief, then the may not give to their local charity for the homeless.
The effects of the downturn are likely to have lasting effects. Some predict that charities will feel the pinch well into 2010. Certainly, by the end of 2008, many charities will feel the squeeze in real time. Lagging money market rates and CD rates will cause the senior crowd will rethink their disposable income.. A down stock market will mean less publicly traded stock donations.
It is not cause for despair. Americans have always stepped up to help in time of need. And we know that there is still more capacity that is not being tapped. Despite the well known American generosity, we know that giving as a percentage of income is on the decline. Likewise, we know that non cash donations remain largely untapped by Christian charities.
The message? Prepare now for the coming months and diversify your offerings.
William High is the President of the Servant Christian Community Foundation (www.servantchristian.com). He may be reached at whigh@servantchristian.com. Christian Foundation Grant (www.christianfoundationgrants.com) is a subscription database of foundations offering grants to faith based organizations. iDonate.com (www.iDonate.com) is a service to non profits that allows them to receive non cash gifts online