Solutions
Donation Page
Investing
Cash Reserves
Advisory Services
Stock Donations
Crypto Donations
DAF Grants
Endowments
Who We Serve
Faith & Ministries
Education
Human Services
Conservation
Arts & Culture
Animal Welfare
Associations
Foundations
Company
Team
Services
Pricing
Security
Resources
Blog
Case Studies
Crypto Whitepaper
Investment Policy Template
Detailed Firm Summary
Ultimate Guides
Log In
Get Started
Finance

3 Ways Inflation Impacts Nonprofits

Losing buying power, rising wages, and increased pressure on development teams - inflation is impacting nonprofits. We can help.
Karen Houghton
December 6, 2022

Inflation is a leading economic indicator that is defined as the decline of purchasing power of the dollar over time. The rise in the general level of prices, often expressed as a percentage, means that our dollar effectively buys less than it did in prior periods. This becomes particularly impactful on nonprofit reserves.

As many of you know, inflation has risen to a whopping 7%. Labor, facility, and capital expenses that you may need down the road are sometimes seeing 10-20% increases. And although the Fed has indicated a steady rising of interest rates to curb inflation, it shows no signs of quickly abating to the central bank's 2% target. Here are 3 ways this impacts nonprofits.

1. Losing buying power.

If your current investment strategy has been savings accounts, money markets, or CDs  - you are likely topping out returns between 0.06% and 0.1% average annual returns. That means that despite best intentions, your reserves could be actively losing value. So while it may seem “safe”, it may not be financially savvy.

Nonprofit’s have a responsibility to be good stewards of donor funds and should have an intentional focus on long term capital preservation of their reserves. By preserving your buying power and hedging against inflation, you are guarding your future and reducing the need to constantly bring in greater donations. 

2. Increased wages.

Average hourly earnings increased by 4.7 percent last year, according to the Bureau of Labor Statistics. While that’s good news for workers, it presents a challenge to nonprofit employers to keep up or risk losing workers. Unfortunately it likely won’t stop there. The Conference Board, a membership organization for small businesses, projects that trend will continue in 2022, with wages rising another 3.9 percent.

A survey released in December by the National Council of Nonprofits found that 42 percent of nonprofits were struggling with job vacancy rates of 20 percent or more. This rising tide of job vacancies means nonprofits have to have a renewed focus on team retention. Mission driven work helps, but our teams also face inflation and need higher wages to pay for them.

3. Increased pressure on development teams.

Inflation also puts development teams under increasing pressure to bring in more donations to offset rising organizational costs. This may be an undue burden if not shared. Global inflation impacts everyone including donors, so make sure you are providing support and giving them additional tools to be successful.

Consider our free endowment gifting tool that invites donors to create giving legacies while building sustainability for your organization. Start asking for stock gifts instead of just cash, to increase gift amounts from high wealth donors. 

Finally, simply moving your funds from a savings account, CD, or money market into a diversified and conservative portfolio of stocks and bonds can hedge against inflation and potentially create income over an extended period of time. There’s a reason donor advised funds, community foundations, National Christian Foundation and even your 401ks invest in the market - it works.

Already investing? Check your fee structure. The difference between 50 basis points and 130 basis points could be thousands of dollars of donor money you should be saving and not putting towards a third party vendor.

Protect your reserves from inflation. 

Hedge against inflation by leveraging Infinite Giving, an investment platform for tax exempt entities, that provides fiduciary oversight and diversified and rebalanced portfolios of low cost index funds and ETFs. This gives you complete control and access to your funds while outsourcing investment and fiduciary responsibilities. Choose an investment strategy that focuses on long term capital preservation of your reserves in conservative portfolios that should help you retain buying power for your future needs. Contact us to get started.

‍

‍

‍


Infinite Giving is a Registered Investment Advisor and asset management platform. We help you easily invest reserve funds, create and manage endowments, and receive stock and crypto gifts all in one easy to use platform. Investing isn't easy, we just make it feel that way.


Explore More 

Finance

 Articles

Finance

Why Nonprofit Leaders Must Prepare for a Recession

A recession tests more than just the economy: it tests our values. The challenge ahead is clear.
May 8, 2025
Finance

When Crisis Hits - Why Every Nonprofit Needs a Financial Safety Net

The recent funding freezes are a wake-up call for many of us in the nonprofit sector. Now is the time to invest in a cash reserve fund.
April 21, 2025
Finance

Unlocking Value: Why Nonprofits Should Encourage Donations of Securities This Giving Season

With half of all stock gifts happening at the end of the year, now is the time for nonprofits to educate, prepare, and promote securities donations.
March 23, 2025

Grow Your Giving with Expert Nonprofit Financial Advice

Join thousands of nonprofits who are transforming how they grow their endowments and donations. Subscribe today and receive updates on our latest tools, expert advice, and industry trends!

By clicking Sign Up you're confirming that you agree with our Terms and Conditions.
Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form.
Financial Stewardship for Greater Impact
Get Started Today
What We Do
Donation PageInvestingCash ReservesAdvisory ServicesStock DonationsCrypto DonationsDAF GrantsEndowments
Who We Serve
Faith & MinistriesEducationHuman ServicesConservationArts & CultureAnimal WelfareAssocationsFoundations
Company
AboutAdvising ServicesDisclosuresPricingSecurityContact Us
Resources
BlogHelp CenterCrypto WhitepaperInvestment Policy Template
Copyright © 2025 Infinite Giving, LLC
Privacy PolicyTerms of Use
Infinite Giving, LLC is a Registered Investment Adviser. Advisory services are only offered to clients or prospective clients where Infinite Giving, LLC and its representatives are properly licensed or exempt from licensure. This website is solely for informational purposes.  Past performance is no guarantee of future returns. Investing involves risk and possible loss of principal capital. No advice may be rendered by Infinite Giving, LLC unless a client service agreement is in place.

*Treasury Portfolio Disclosures: Forecasts or projections of investment outcomes are estimates only and as such they are imprecise and hypothetical in nature, do not reflect actual investment results, and are not guarantees of future investment results. Investing involves risk, including the possible loss of principal, and there is no assurance that the investment will provide positive performance over any period of time. Infinite Giving accounts are not bank guaranteed or FDIC insured. 4.35% is sourced from treasury.gov Feb. 11, 2025 13 week coupon equivalent rate yield. Projected and/or hypothetical performance is intended to show only an expected range of possible investment outcomes based on historical average returns and standard deviation of each investment type, but does not take into consideration the effect of taxes, changing risk profiles, or future investment decisions. Projected and/or hypothetical performance does not represent actual client accounts or actual trades and may not reflect the effect of material economic and market factors.

Infinite Giving, LLC provides links for your convenience to websites produced by other providers or industry related material. Accessing websites through links directs you away from our website. Infinite Giving, LLC is not responsible for errors or omissions in the material on third party websites, and does not necessarily approve of or endorse the information provided. Users who gain access to third party websites may be subject to the copyright and other restrictions on use imposed by those providers and assume responsibility and risk from use of those websites.

Please see our Full Disclosure for important details. Firm ADV Brochure | Terms of Use | Privacy Policy