Your Guide to Finding, Engaging, and Retaining the Next Donor Generation

Boomers, born between 1946 and 1964, currently hold the largest share of US wealth and reflect 43% of total charitable giving— but that’s about to change. The Great Wealth Transfer is on the horizon, and it’s time for your nonprofit organization to start preparing for when assets will pass to the next donor generation, reshaping the philanthropic landscape.

Now Is the Time to Think About the next Donor Generation

Despite wealth concentration in older demographics, Millennials and Generation Z are the two largest in the US. As Boomers grow older, an anticipated $84.4 trillion in assets will transfer to Millennials and Generation Z through 2045, including $72.6 trillion going directly to Boomer heirs. Inevitably, nonprofits are already seeing this transfer reflected: between 2016 and 2022, the average Millennial household increased its annual giving by 40% (from $942 to $1,323), contrasting the decrease in Gen X’s (-4%) and Boomers’ annual giving (-12%) during this same period.

With this impending shift comes a pivotal moment for your nonprofit to adapt as new donors bring new perspectives and giving priorities. Longtime, reliable donors have different values than their children—even if wealth stays within a family, giving priorities and personal motivations may not. The organizations that have taken the time to invest in the younger generations in preparation for this great wealth transfer are seeing rewards and a strong pipeline for the future of their organization.

Understand the Next Donor Generation

With this transfer, most wealth will pass directly to the heirs of current donors. You can begin establishing yourself with your next donor generation by learning about the descendants of your current donor base and getting to know them as individuals with interests and values separate from their family name.

Philanthropic parents raise philanthropic children, and family foundations make up over half of all private foundations, often staying within the family for several generations. However, recent trends show a departure from this norm, with some family foundations transitioning management to non-family members. This shift underscores the importance of engaging with both current and future generations of donors.

Millennial and gen z giving motivations

Millennial and Gen Z donors are driven by a desire to create meaningful change in the world and support causes that align with their values while also expecting transparency, authenticity, and community engagement in their philanthropic endeavors.

millennials

Millennials, born between 1981 and 1996, are adaptive to technology but much less dependent on it than Generation Z. Millennials make up a large percentage of today’s workforce, balancing the demands of building a career, raising a family, and giving back to organizations they are most passionate about. Like Generation Z, Millennials are closest to organizations that directly reflect their values about current societal and economic issues. Millennials typically research a nonprofit or make a connection before making a gift.

Gen z

Generation Z (Gen Z) refers to those born between 1997 and 2012. Considered the most technologically advanced generation, the internet, social media, and smartphones are part of their everyday life. They have witnessed global issues ranging from economic downturns, domestic and international safety concerns, gender inequality, racial injustice, and climate change. Unsurprisingly, Gen Z cares about impact and wants others to know they are a part of specific causes, focusing more on public recognition.

where to find your next donor generation

The Great Wealth Transfer provides opportunities to discover new donors whose interests and values align with your organization in a way those of other generations did not, but where can you find them?

Young donors spend time online

Millennials and Gen Z donors have moved away from desktops in the last decade and are online, specifically on mobile devices. As the world becomes increasingly virtual, so does philanthropy. Even when responding to direct mail campaigns, which are still popular among nonprofits, Millennials and Gen Zs give online more often than their predecessors.

millennial and gen z donors crowdfund

The COVID-19 pandemic helped fuel the recent increase in online giving while also creating a significant shift toward crowdfunding, proven by the popularity of sites like GoFundMe and Kickstarter. These small-scale, collective aid efforts help cultivate young donors by introducing philanthropy and planting the seeds to one day become consistent donors. Crowdfunding, fueled by 24- to 35-year-olds, also allows individuals to directly support causes they care about, regardless of organization size or complexity.

millennial and gen z donors use social media and explore your website

Exploring Gen Z and Millennials’’ behavior on social media will help you understand what organizations young donors want to give to and how to market your nonprofit work to them. Nonprofits should leverage social media for outreach and invest in user-friendly online giving platforms, as a seamless online experience enhances donor engagement and retention, particularly among tech-savvy Millennials and Generation Z. Undertaking website optimization assessments can further enhance searchability, branding and design, user experience, security, and content, to name a few.

how to engage the next donor Generation

So, you know where to find young donors, have built out your website, and created an easy path for online donations… now what? The following three principles will help you engage Gen Z and Millennials.

demonstrate authenticity

Like those before, the next generation of donors has various interests and will give across sectors. Whether addressing climate change, education reform, healthcare support, or social justice advocacy, Millennials and Generation Z respond generously to causes aligning with their values. Nonprofits must demonstrate authenticity, emphasizing tangible outcomes to resonate with these donors.

be transparent

Transparency is paramount for younger donors accustomed to readily accessible information—public financial statements and annual reports are crucial in fostering trust and accountability. Whether through social media, email outreach to your current database, or an event celebrating your end-of-year impact, make sure people know that their donation, no matter how small or what type, supports your cause and not just your organization.

get donors involved

Allow up-and-coming donors to give to your organization beyond financial gifts. Millennials and Gen Zs can volunteer, act as social media ambassadors for your cause or fundraising events, peer-to-peer fundraise, attend events, or obtain corporate sponsorship through their employment.

how to retain the next generation of donors

Once you’ve found and engaged young donors, the next challenge is keeping them engaged. Here are some important tactics for ensuring donors stay committed to your nonprofit’s mission past their initial donation.

communicate effectively

When communicating with Millennials and Gen Zs, using multiple channels, particularly social media platforms like Instagram, TikTok, X, or Facebook is most effective.

• Ensure emails, your website, and giving pages are all mobile-friendly.
• Articulate the action step you want the recipient to take (e.g., raise awareness, attend an event, donate, volunteer, etc.).
• Use images or video, when possible, for more interesting storytelling.

Because this next donor generation gives to the causes it cares about and wants to know it makes a difference with its gifts, being open and celebratory about what donations allow your organization to achieve is paramount. Share success stories early and often with donors, including quotes or other personalized features.

involve the next donor generation on your board

Another key strategy for young donor retention is involving them on your nonprofit’s board. Here, we’ll delve into two approaches to engage the next generation through board activity, each with its own benefits for building lasting connections with up-and-coming supporters.

create a junior board

Unfortunately, a shift in values is not the only difference between generations, as Millennials and Generation Z are more likely to experience affordability challenges, such as delayed homeownership. Millennials are also the generation most likely to live paycheck to paycheck. Despite this lack of resources, Millennials and Generation Z are the most likely to volunteer their time with organizations they care about.

Junior boards effectively involve young donors, create interest and investment in your organization’s goals, and encourage other young donors to give. People like to see themselves represented—an organization showing genuine interest in the next generation’s opinions will attract more young people.

create a more inclusive board

If your nonprofit doesn’t have a junior board, consider ways to make your board more inclusive for young people by examining why there aren’t Millennials and Generation Z in organizational leadership. Explore ways to break down financial barriers to involvement, such as sliding scale contributions, non-traditional give-and-get policies, and mentorship or sponsorship programs. Include younger generations now to create lasting relationships.

the next donor Generation Is changing philanthropy

You now have the resources to cultivate young donors before the Great Wealth Transfer. Get to know your donors and volunteers of all ages and explore new ways to connect on your shared values, beliefs, and unique purpose. The next donor generation is speaking up and wants to help solve the world’s most pressing issues, so focus as much on your nonprofit’s future philanthropists as you do on your traditional donor base. By actively engaging the next generation, your organization can harness the opportunities of the current and continued changes in the philanthropic landscape.

*This article is a refresh of “Engaging the Next Generation of Philanthropists” by Courtney Labetti, CFRE, CAP, Vice President; Kaleigh Wagner, Assistant Vice President; Alexander Fruin, Assistant Vice President