Annual Donations and Major Gifts
The Annual Fund sustains the organization and should be a primary strategy for stimulating the giving of unrestricted funds to allow the organization wide latitude in meeting its expenses. The Annual Fund is usually a donor’s first gift to an organization, unless they have made a gift through an event. The Annual Fund allows the organization to build a predictable base of support and provides a pool of proven donors that might be needed at some point, once they have made both repeat and larger gifts, to become major donors. The donor database that is built over time will also serve as the primary information bank to be used in planning all fundraising programs for the organization. When an individual moves from an annual fund donor to a major donor will vary from organization to organization. For some organizations major gifts might start at $1,000, while for larger institutions the major gift threshold might begin at $10,000.
Annual donations are frequently given and asked via a letter, email, phone, special events and social media. Often donations are discretionary income for the unrestricted fund. On average, annual donations make up 90 percent of the organization’s number of gifts, but only 10 percent of total dollars raised. Often, a donation to the Annual Fund is the first step to a major gift.
Major gifts are infrequently given or asked for. When an organization asks for a major gift, it occurs in pre-meeting materials and in person or sometimes in a small group. Generally, it is from assets, not income, and is allocated to more targeted or distinct projects. Typically, a major gift is 10 to 20 times larger than an annual fund gift. While an annual fund give may be around $500, a major give is typically $5,000 - $10,000 based on the organization and its funders. On average, major gifts are 10 percent of the organization’s gifts, but 90 percent of total dollars raised.