Unstable or short-term funding is the top concern for most not-for-profits, with only one in four reporting financial sustainability.

Philanthropic funding and individual giving were the most commonly cited primary revenue stream, ahead of government funding and income from services or products. However, few organisations reported a truly diversified income mix, leaving many vulnerable to shifts in donor behaviour or the broader economy.

Many organisations reported significant strain due to growing community demand, compounded by the cost-of-living crisis, and rising operational costs.

Frequent swings in funding are making it difficult for organisations to plan ahead or invest in long-term initiatives. Over 40% of organisations experience significant income fluctuations throughout the year, while 25% report highly variable income across years.

Many organisations are holding surplus funds in low-yield vehicles like bank accounts (40%), while others are using term deposits (23%) While these options offer security, they may not support long-term financial growth and come with administrative burdens.

Many responses highlight the need or opportunity to strengthen financial sustainability through innovation, diversification, and long-term strategies.

The report is primarily designed for not-for-profits looking to understand how their peers are navigating today’s challenges and building financial sustainability. It’s also valuable for funders and others in the philanthropic sector who want deeper insight into the pressures facing NFPs – and how they can better support long-term resilience.

Between May and September 2025, Australian Communities Foundation surveyed 240 not-for-profit organisations across Australia. These organisations vary in size, focus area, and location. Participants responded to multiple-choice questions about financial sustainability and shared reflections on the key challenges and opportunities they’re facing.

Since 1997, Australian Communities Foundation has helped donors give more effectively, facilitating over $220 million in grants to Australian NFPs. We support a growing network of over 700 Funds and Foundations, championing best-practice giving – including untied and long-term support. We also provide not-for-profits with tools and strategies to strengthen financial sustainability, such as our Future Fund offering.