HOME >BLOG

Boost Your Nonprofit With These Unique Funding Options

Blog_NonTraditionalLooking for some alternative funding methods for your nonprofit? Don’t worry, there are plenty of options available!

Fundraising and donations are the bread and butter of your organization, but there are other ways to receive the money that you need to keep your nonprofit strong and resourced.  Let’s take a look at some of the options below.

Planned Giving

One way to request funds from donors is through bequests, trusts, pooled income, or gift annuities. Many donors enjoy leaving some money in their will for a cause that they care about. It is a great way to leave a good legacy that they’re proud of.

To make this possible for your nonprofit, all you need to do is launch a Planned Giving program that makes it easy for donors to get on board and choose the way of giving that works best for them.

Here are the common types of planned giving options:

Bequests

Bequests are the most common type. This entails a donor leaving a sum of money in their will or estate for your nonprofit. They can do this through a percentage of their income or a set amount, depending on their preference.

Trusts

Donors can set up a charitable trust that makes payments to the donor annually, and a small percentage of that payment goes to the nonprofit of their choice for a set amount of time.

Pooled Income

These are investment trusts that your nonprofit can set up. You can have donors give funds to the trust, your organization can invest that money, and then pay dividends back to your donors. The rest of the money in the trust can go towards directly funding your nonprofit.

Gift Annuities

If you need a moderately large amount of money, you can request a gift annuity from a trusted and engaged donor. The donor will receive a tax deduction for this funding and will get payments back from the donor over time. However, your nonprofit can invest this money in order for it to grow, making more money off of the original amount that you get to keep.

Loans

While it’s difficult for nonprofits to get a traditional business loan, there are alternative loaning options that nonprofits can receive.  Here are couple of nonprofit friendly loan ideas:

Nonprofit Loan Programs

Some large nonprofits have loan programs for smaller nonprofits that are in need of funding. These types of loan programs exist specifically to help nonprofits make a difference, so the interest rate tends to be a little lower than loans you’d get from other institutions.

Banks or Credit Unions

There are a few traditional credit unions and banks that have loan programs specifically for nonprofits. If you choose this option, make sure you research that program to determine if it suits your needs.

Credit unions tend to have slightly lower interest rates, but they also give smaller amounts. Alternatively, banks often give higher amounts, but their interest rates are also much higher.

Crowdfunding

Another good option, especially if you are first starting out, is crowdfunding. You can request donations from donation-lending based crowdfunding. Or, you can set up a crowdfunding loan with no interest rate, so you’ll only have to pay back what you receive.

There are plenty of ways to receive money for your nonprofit, so don’t stop here. But this is a wonderful selection to explore. Make sure that you choose the resource that aligns best with your nonprofit’s needs and abilities.

 If you have any other questions about non-traditional funding, contact Auxilia to see how we can help!

Photo Credit: Campaign Creators

Topics: Crowdfunding, Planned Giving, Investments