As tariffs continue to weigh on the North American economy, many households are tightening their budgets, reducing discretionary spending, and ultimately affecting donor capacity and giving behavior.
At FundRazr, we understand nonprofits are navigating a tightrope right now, facing rising costs just when community needs are surging. You’re doing more with less, and that strain is real. Here’s what’s happening to the fundraising industry, what it means for your organization, and how you can transform challenges into opportunities.
Make sure you read till the end to discover how to turn today’s learnings into actionable results!
Tariffs & Inflation: A Strain on Both Sides of the Giving Equation
Tariffs are pushing up the cost of in-person fundraising event materials and technology, raising expenses for nonprofits. Meanwhile, donors are tightening their budgets, cutting into digital donations. In fact, some organizations have seen a 30–37% decline in donations following tariff announcements.
The calls for help from local nonprofits are also breaking records. A nonprofit organization from Kansas explains that they are unable to keep up with the needs that arise in the community as they face policy changes and funding cuts.
“Trying to operate from the same [or less] budget while also supporting more people and new programs” just doesn’t make sense. – Jessica Ferrell, Director of Operations at Center of Grace.
Economic uncertainty, from inflation to employment insecurity, is eroding both giving frequency and gift size.
👉 Why it matters: The backdrop for year-end campaigns is tougher than usual. Nonprofits need empathy-backed tools and narratives that reassure donors they’re making an impact, even in hard times.
Shifting Donor Behavior: Spotlight on Stability
Despite the effects of economic uncertainty on fundraising, recurring giving is gaining ground. Monthly donations now make up 31% of online revenue, up 5% year-over-year. And encouragingly, they generate an additional 0.2 one-time contribution per donor. New donors make up 21% of online revenue.
On the other hand, micro donors (those who contribute on average $1-100), which makes up 57% of all donors, saw an 11.1% decline, signaling stress among small-gift contributors.
Nonprofits are prioritizing diversified revenue streams over dependency on grants and foundation giving due to economic uncertainties and fluctuating grant cycles. They are seeking more sustainable and predictable funding sources like recurring donations and corporate sponsorships.
👉 Why it matters: Donors appreciate giving that’s predictable, for them, and for nonprofits. Prioritizing recurring options builds stability.
Donor Retention Remains Critical but Costly
While total donor numbers dropped by 4.5% in 2024, total dollars still rose due to larger gifts.
Acquiring a new donor costs up to 5 times more than retaining an existing one. Plus, 40% of millennials are signed up for monthly giving.
👉 Why it matters: Boosting retention, especially among younger, recurring donors, is both smart and cost-effective.
Gen Z Donors & Peer-to-Peer Fundraising: The Surging Frontier of Engagement
Peer-to-peer campaigns are expanding reach, particularly among youthful, digitally native demographics. Gen Z gives through digital channels and values transparency.
25% of them say sharing causes is part of self-expression and 41% say social media motivates them to donate.
👉 Why it matters: Authentic storytelling and digital-first activations are essential, especially for attracting and energizing younger donors.
End-of-Year Giving: Still the Power Period for Nonprofits
Even amid broader economic uncertainty, year-end giving continues to climb, showing a 16% increase since 2023. December remains vital, accounting for 30% of annual giving, with GivingTuesday setting the tone for sustained generosity.
👉 Why it matters: The digital campaign season still pulses with potential, especially if you lean into peer‑to‑peer fundraising, early preparation for Giving Tuesday, and message clarity.
What This All Means for Nonprofit Organizations
With the financial pressure expected to escalate in the latter half of the year, it’s critical for nonprofits to adapt swiftly. Fewer small or occasional donors means organizations need to double down on retention, recurring gifts, and storytelling to keep support strong. Nonprofits that prepare early will maximize results.
| Key Insight | Why It Matters |
|---|---|
| Tariff-related pressures and donor pullback | Giving Season campaigns face elevated difficulty. Nonprofits need strategic shifts. |
| Growing share of recurring revenue | Recurring models drive stability and nurture long-term giving relationships. |
| Decline in new and micro donors | Holding on to existing donors is more important now than ever. |
| Gen Z engagement through P2P and impact storytelling | Digital natives respond to authentic, mobile-first, socially shared campaigns. |
Your Nonprofit’s Next Step
At FundRazr, we believe understanding the terrain is the first step toward success. That’s why we shared this comprehensive Giving Tuesday Report, your guide through this challenging fundraising season.
👉 Next steps: Watch our on-demand webinar where it is packed with actionable strategies and best practices turn these insights into powerful campaigns.
Stay Tuned For More Free Resources
Our free resources are designed to help your nonprofit turn today’s learnings into actionable results. Stay tuned for more:
- Giving Tuesday Fundraising Toolkit: From Insights to Action
- Giving Tuesday Success Stories – Meet our top nonprofits that turned uncertainty into opportunity
