Donor Objection: “What percentage of my gift goes to overhead?”
This question feels like a trap. It’s usually not. Most donors ask it because they think they should ask something, not because they have a specific number in mind.
What the donor may actually be saying
- “I want to feel confident my gift is being used well.”
- “I’ve been burned before by organizations that seemed wasteful.”
- “I don’t fully understand nonprofit finances, and this is the question I know to ask.”
- “I’m looking for a reason to feel good about saying yes.”
It’s helpful to know: most donors can’t tell you what overhead percentage would actually be acceptable. They ask the question because it feels responsible — not because they’ve done the math.
What not to do
Don’t reflexively recite your overhead percentage as if that settles it. Even a low number doesn’t address the real concern underneath, which is almost always about trust and impact, not arithmetic.
And if you’re saying “90% of your gift goes directly to programs” — stop. That framing trains donors to expect your organization to starve its own infrastructure. You’re setting up a problem you’ll have to solve later when you need to invest in staff, technology, or systems. You’re also not being entirely honest about what it actually takes to do this work well.
Don’t get defensive. The donor isn’t attacking you. They’re trying to make a responsible decision.
What to say
Try getting curious before you answer:
“That’s a fair question. May I ask — what would feel like the right percentage to you?”
Most donors will pause. They haven’t actually thought it through that specifically. That pause is your opening:
“The reason I ask is that there isn’t one right answer — it really depends on what we’re trying to accomplish and what it genuinely costs to do it well. As with your business/work, there are some years where it’s wise to invest in infrastructure. Others where you get to enjoy the past infrastructure investment.”
Then shift from percentage to outcomes:
“What I’d love for you to feel confident about is that your gift makes a real difference. Can I show you specifically what it would fund?”
If they want a number, give them one honestly:
“As you can see on our most recent 990, administering this nonprofit is about [X%]. I’m proud of that because we’re really good at what we do. We believe this area is worth bringing the best people to work on it.”
The deeper principle
As Marc often puts it: the overhead question is rarely about overhead. It’s about trust. A donor who genuinely trusts your organization rarely asks about percentages — they ask about impact. If this question keeps coming up with a particular donor, the more useful question to ask yourself is: have we given them enough reason to believe in us? If not, the issue isn’t your expense ratio. It’s the relationship.
AI prompt
A donor asked about our overhead percentage during a solicitation. Here’s how we think about organizational investment and what our actual numbers look like: [details]. Help me draft a response that’s honest and donor-centered — one that addresses the concern without being defensive and redirects toward outcomes and impact.
Privacy note: Use initials or a general description rather than your donor’s real name. Avoid including sensitive financial details beyond what’s needed to give useful context.