How Do Nonprofits Make Money? Is It Possible?

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how do nonprofits make moneyIt would be nice if people could do what they love, like volunteering all the time. However, that is not the case for many people. Most people have to worry about making money and the idea of earning a living from a non-profit may not seem attainable to some people, even though it is. So, how do nonprofits make money? Is it possible for you to earn money from a nonprofit?

Well, it is possible and it can be simple to earn money with a non-profit. You can earn a living from a non-profit and even enjoy a number of additional perks other forms of work couldn’t offer. But, only if the non-profit is ran effectively. The following guide can even help a non-profit pay out a salary or salaries.

How Do Nonprofits Make Money? Is It Possible?

When you think of nonprofits, you mainly think about volunteering or unpaid internships. Most people want to know, how do nonprofits make money? Well, take a look at some of the ways that you can earn money with a non-profit. 

Understanding Positions Within the Charity

A person hoping to get paid from a non-profit needs to understand his or her position within the organization.

This is very important because this step can:

  • determine how much a person is going to make within the organization;
  • also gives the government a guideline to how much one should be earning.

The government is perfectly happy with people being paid. However, the payments received need to match the work given. The IRS compares salaries to similar positions and will not accept salaries that are unusually high.

Keep in mind that it is in the organization’s best interest to ensure all salaries are as low as possible. Each charitable organization is heavily monitored, and if you spend less than a third of the money collected by the non-profit on charity work, people are less likely to donate.

Related: 7 Ways to Give Back When You’re Broke

Building Money Flow in a Charitable Organization

Getting paid by a non-profit is only possible when that organization has money to pay you. If the organization just started and has no funds, then there is no way the company can pay anyone.

Most people working at non-profits are doing so to help others. But, people in organizations with a lack of funds will have to keep a second job to pay the bills or take a few odd jobs here and there to get by.

This is the reason non-profits need to figure out a way to get money coming in as soon as possible. It is the only way to be fair to those who volunteer their time and the only way to retain great talent that would help the organization move forward. Now, for a non-profit to make money, it has to do a number of things. The following are just a few examples:

Snail Mail

This is perhaps one of the most reliable and classic ways of getting money for the organization. People still love these campaigns, especially because most people do not mail things anymore, so getting mail is kind of unique. Mail shows a level of commitment to each person that simply cannot be compared.

In-Person

Another classic way of getting donations is by knocking on doors. Non-profits could also stand in crowded places, and talk to people about their organization. Both of these are similar since they require a lot of footwork. Part of what makes these campaigns successful is that interested parties can ask questions and clarify an issue that could be holding them back from donating.

Email Campaigns

Setting up an email campaign is another way to attain money. A lot of people open their emails every day and non-profits can use this in their favor. An email can remind supporters that the organization is still in need or that the organization is starting a new mission. Both of these could help people feel inclined to donate.

Online Option

Organizations could also raise money by placing an easy-to-use donorbox on their sites. Every non-profit knows that people are always interested in what the organization is doing, and most of the time, this means visiting a site. The website of a non-profit usually has high-traffic, so capturing donors from visits is vital. Online users love simplicity, so you have to make sure visitors can donate easily.

Outside the Norm

Organizations do not always have to receive money through the more conventional venues. There are some non-profits that are a little more creative with the way they earn money. Some non-profits actually own property and rent it out in order to earn money for the organization while others sell donated merchandise to turn a profit. There are some organizations that even invest money to allow money to work for them. It is important to note that if the non-profit makes its money in ways that are unrelated to the mission, the IRS is going to tax those funds.

How Do Non-Profits Make Money? In Conclusion…

Of course, these are only some ways a non-profit can make money to pay its employees a salary or a living wage. People want to give as long as the organization has a good mission and makes it easy for them.

There are other ways to make money, such as:

  • crowdsourcing
  • through phone calls

However, it is important that those who work for organizations like this to not expect to get paid much.

So next time you’re thinking “how do nonprofits make money?” Think of the options they have to choose from. People who work at non-profits should be as frugal as possible. They should also enjoy the perks, like being able to use a non-profit’s vehicle or other perks like that. Payments can be helpful and planning should ensure money is used wisely.

If you’re thinking of starting a non-profit or you’re currently a part of one, did this give you some insight as to how your non-profit can earn money effectively?

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Money

LaTia Longuemire

AUTHOR LaTia Longuemire

My name is LaTia Longuemire. I enjoy writing, singing, and cooking in my spare time. My passion is helping others. At this stage in my lifetime, I'm primarily focused on my children. They are everything that keeps my world spinning.

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