In a recent blog post, we shared 4 key steps nonprofit leaders can take to manage this moment. We now turn to funders – many of whom are asking us a similar question: What should I be doing right now to support nonprofit organizations?

There are four things funders can do now to help nonprofits navigate the broken economic system. Most may sound familiar, but their urgency has never been greater. We know many in the philanthropy community already recognize what’s at stake – especially leaders advancing trust-based philanthropy. Others are prepared to act but face barriers to implementing change. Along with outlining the four actions, we also share practical suggestions for putting them into practice, recognizing that some fall within an individual program officer’s control while others require time, internal advocacy, and buy-in from foundation leadership and trustees.

Our recommendations are grounded in our experience as advisors for both nonprofit leaders and funders to address an inequitable funding system – one that challenges nonprofits even in the best of times. Our experience gives us a unique vantage point to bridge financial understanding between funders and nonprofits. While both are striving toward the shared goal of community prosperity, we see that financial misconceptions, miscommunication, and power dynamics often stand in the way of honest, constructive dialogue about money and funding. This piece invites funders to act now and evolve their practices that directly impact nonprofits.

1. Provide non-monetary support, including legal and technical expertise.

In the early months of 2025, many nonprofit leaders were navigating a whirlwind of policy, federal funding, and legal changes – all happening abruptly and in rapid succession. We saw funders stepping in to provide access to invaluable legal and technical expertise, helping grantees interpret regulations, assess risks, and maintain commitments to historically excluded communities.
These challenges have not gone away and will likely continue into the next few years. Your grantees are adapting to a rapidly evolving environment and need access to expertise that is timely, accurate, and practical. You can make a meaningful difference by connecting them with legal, accounting, human resources, fundraising, or operational specialists, or by sharing insights and best practices from other organizations facing similar challenges.

How to start? One first step can be reaching out to your grantees and simply asking how you can support them beyond the dollars you provide. Offer to be a sounding board and help them access the expertise they need. Program officers can play a key role by doing the legwork of identifying trusted advisors and figuring out ways to fund or cover the cost of that expertise. These actions not only help nonprofits adapt in the short term but also build long-term resilience.

2. Find ways to reduce the burden on nonprofit grantees.

Throughout 2025, we saw bright spots in funders who found creative ways to ease the burden on their grantees. Many of these examples align with trust-based philanthropy principles and include:

Increased transparency: Be clear up front about what you can and cannot fund, and what changes your grantees can expect. The Colorado Health Foundation (CHF) models exactly how this can be done in a meaningful and clear way. In Spring 2025, CHF reached out to all grantees to clarify its commitments and intentions. In an email to all grantees, the foundation conveyed:

“We want to make it as easy as possible for you to serve your communities. Our commitment to you means:

1. We will continue to make funding decisions based on our priorities as an organization, not in response to federal directives.
2. We will not rescind grant funds you have already received, regardless of changes in your tax status or what activities are deemed charitable.
3. We have removed the searchable grantee database from our website to protect our grantees’ information.”

Flexibility: Allow grantees to pivot without penalty, whether on timing or use of funds. CHF went on to say:

“We are prioritizing flexibility.

1. Multi-year grant payments will no longer be contingent upon progress report submission. Instead, payments will be automatically released in accordance with the payment schedule in your grant agreement, with additional reporting options available.
2. You can work with your program officer to adjust payment schedules if needed.

Reporting can be streamlined: submit a streamlined written report, upload a previously prepared report, or conduct a verbal report with your program officer… Please continue to share ideas about how [the foundation] can streamline our proposal and reporting processes.”

Leading in this way provides both financial relief and support for the stressed, over-stretched leaders and staff at the nonprofits you support.

3. Fund the full cost of the work through unrestricted, flexible and multi-year support.

Programs and mission do not run in a vacuum: They need staff, offices, technology, and operational capacity to sustain them. Full cost funding means supporting both program delivery and the overhead that makes it possible. One of the most impactful things funders can do is provide unrestricted, flexible, multi-year general operating support to give nonprofits the flexibility to plan, adapt, and deliver services effectively – especially in times of crisis like these.

NFF’s full cost framework helps funders understand the depth to which multi-year unrestricted funding covers essential needs in the short- and long-term. Our full cost templates and tools help funders understand the range of costs that every organization needs to cover. We also provide language to help funders engage grantees in honest conversations about using funds for priorities like building working capital and paying down debt. This kind of honesty matters, because we find nonprofits often hesitate to use unrestricted dollars for these purposes without clear endorsement from their funders.

How to implement: For funders just starting their full cost journey, NFF’s framework can provide a valuable starting point. NFF provides full-cost resources for funders online, and also works directly with foundations to help them initiate and implement their full cost journey. We also know that some funders have successfully used existing systems and processes within their foundation to extend grant terms with minimal administrative change, which often reduces paperwork and staff time. This approach builds stronger, trust-based relationships with grantees and allows them to focus on results rather than constant renewals. In practice, this approach provides a more straightforward, strategic way to effect lasting impact.

4. Increase payout levels.

In our NFF State of the Sector Survey findings, we highlighted the strategy of increasing payout levels as a powerful way for funders to be creative and go beyond “business as usual.” For nonprofits operating with thin margins in an uncertain environment, the grants that come from higher payout levels can be a lifeline and can turn endowment strength into immediate community impact.

A couple of things to note: No one expects foundations to replace losses from government cuts – but in this moment, every additional dollar can help stabilize nonprofits under strain. This doesn’t have to be a forever decision. Funders can advocate internally for higher payout even on a temporary basis, creating flexibility to respond to evolving needs. Mostly importantly, foundations that have increased payouts are not seeing catastrophic consequences. There is room to act—without panic.

Some recent examples demonstrate that increasing payouts are feasible and effective – without compromising financial sustainability. In 2025, foundations like Scherman, Weissberg, and Freedom Together doubled the minimum payout to roughly 10%, while MacArthur increased to 6%. Marguerite Casey Foundation increased their 2025 grantmaking to five times their usual level.

How to implement: One small step that foundations can take is to have finance staff or investment advisors model the impact of a payout increase (e.g., additional 1-2% for one or two years), which can clarify perceived vs. actual financial risk, and build shared understanding with leadership or trustees. These examples demonstrate that it is possible to deploy more resources into communities when nonprofits need them most – while preserving long-term financial stability for the foundation.

Call to Action

In this time, threats abound for nonprofits, funders, and the communities we all exist to serve. It can be tempting for all of us to hunker down, hope to ride out the crises. Yet this is a moment of existential threat for some nonprofits, foundations, communities, and the principles of our civic compact. We are the social safety net. If we hunker down rather than acting bravely, the social safety net fails.

So, we all must act: Take action immediately on one or two things that are in your sphere of control. And start to advocate internally for one or two bigger steps your foundation can take. The choices you make today matter, and can have immediate impact. Reach out to us if we can help support your steps on this journey in any way.