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Annual Fund -- This is the year!

So, what was on your list of New Year's resolutions? Better organization? Exercising more? Spending more time with your family? Hopefully, your list also included one of the following resolutions for your school or school system -- create an annual fund or grow your annual fund.

Annual funds are the keystone for all unrestricted giving programs. No matter how small your annual fund is in the first year or two, an annual fund can make a dramatic difference in the stability of your school's financial future. Does it take work and care to tend to an annual fund? Absolutely! Can a well-run annual fund provide the much needed third source funding that everyone is seeking? Absolutely!

This article will outline the basics of creating an annual fund and list some suggestions for growing an already established fund.

What is an Annual Fund?

It is an organized effort to obtain gifts on a yearly basis to support general operations. Funds are typically raised through mail or direct solicitation efforts. Solicitation may take place more than once a year but is distinguished by the regularity. Gifts are usually directed to unrestricted income.

Beginning an Annual Fund

Here are the steps needed to begin an annual fund:

Database and/or Mailing List

Start with a list of parents, grandparents, alumni, parents of alumni, parishioners and others that have shown an interest in your school. Gather their addresses and create a database. If you are just starting out and you do not have donor management software, create an Excel sheet that you can expand to include gift amounts and dates. Ask a local printer to run your mailing list through the National Change of Address (NCOA) database and make corrections.

Ask for Help

Seek out volunteers to help you organize and execute the campaign. One of the wonderful things about Catholic schools is there are always parents, alumni and parishioners stepping forward to help. Planning and running an annual fund requires a variety of talents. Think of the skills that will make a big difference and ask the right people -- communicators and connectors to help sign letters and seek donations, organizers to work on the mailing list and track donations, and writers to create the letters, just to name a couple. Like so many projects, annual fund campaigns are so much easier when it is a group effort!

Create a Plan and Timeline for this Year's Campaign

Like any lesson or school project, you need to create a plan for your campaign. Set goals based on how you will work your annual fund (we will send two appeal letters this year) and also based on results (50% of our parents will make a gift or pledge to this year's campaign).

Create Letter, Response Form and Response Envelope

Write a compelling and positive letter. Consider your audience and what you would tell them in person. Remember that people want to support success and tend to shy away from emergency situation. Share your accomplishments and your positive trends rather than listing things that are working against your school. For instance, each and every day something wonderful is happening in your classrooms. Share those stories!

List of Good and Bad Words to Use in Appeal Letters

Download Document

Personalize the letters by including people's names in the salutation. Hand sign as many letters as possible and take the time to write personal notes on the letters. Will this make a difference in your response rates and donations – absolutely! You are asking people to support your mission and to give a gift. Take the time to show your potential donors that they are valued and important.

Create and include a response card with your mailing and also include a response envelope. Your goal is to make it very easy for someone to support your mission! If possible, your response card should offer the option of a credit card gift. If you do not have the ability to do this at your school, see if your parish would be able to process your credit card gifts.

Suggested Language to Include on a Response Card

Download Document

Processing and Tracking Gifts

Gifts must be processed and tracked in a responsible manner. This means that you must keep donor information confidential. Confidentiality cannot be overstated. Make sure that you have a trusted and very small group that process, track and maintain your donor information.


Promptly send acknowledgments and know that you cannot thank donors too often!

Do you already have an established annual fund? If so, congratulations but this is not the time to rest on your accomplishments. Now is the time to assess what is working well, what needs attention and what can be improved!

Tending Your Annual Fund

Here are some suggestions for tending to your annual fund:

  • Raise awareness of your annual fund and how it impacts your school
  • Clean up your database
  • Prospect and research your potential donors
  • Upgrade your solicitation effort
  • Review and upgrade your appeal pieces
  • Increase your personal solicitations
  • Seek matching grants/donations
  • Expand online giving opportunities
  • Get more creative with your acknowledgments

In closing, annual fund campaigns make a tremendous difference. Reach out to your supporters and offer them the opportunity to partner with you and continue the blessed tradition of Catholic education!