“This is so good, once we start it, we’ll find a way to fund it,” the leader announced with conviction. Around the conference table, a number of the group, murmured in agreement.

If you have been around nonprofit organizations very long, you will recognize this conclusion as a case of risky thinking and unfounded optimism. Far too many organizations conclude that, when a program is worthwhile, the money will follow. After making this false step, they add services that they cannot sustain because the money is never found.

What to do instead? I recommend that, before you start your new effort, you create an intentional income plan. To help you get started, consider the following 14 funding approaches that create income:

Earned income for services

1.The individuals served pay an equal portion of full cost of the service. Examples include neighborhood associations, clubs and worship centers.
2.The individuals served pay for part of the cost. This payment can range from a token fee (i.e., a dollar) to 90-95 percent of the true cost of the activity.
3.A variety of fee structures are offered; some individuals pay the full amount; others pay less than the actual cost. Examples of these approaches include the use of discounts and sliding scale charges.
4.The individuals served pay more than their fair share of the full cost of the services. Examples of this include tickets for special events and requests to sponsor others.

Earned income from grants

5.Fees-for-service grants, including those from government, foundations and federated funds.
Individual, corporate, foundations donations
6.Full or partial scholarships to sponsor individuals.
7.Donations for direct program services.
8.Donations for operating support, i.e., administration.
9.Quid pro quid and semi-quid pro quid arrangements-donations that entitle the donor to receive marketing, goodwill or premiums such as banners at events, listing in programs and free gifts with memberships.
10.Receipts from planned giving.

Earned income from associated services

11.Fees earned from services that do not involve your mission, i.e., hall rental and receipts from consignment shops, refreshment stands, bake sales and raffles.

Earned income from savings

12.Income from endowments or reduction of principle.
13.Revenue in excess of expenses from other activities or interest earned from such income.

Finally…

14.A combination of four or more of these sources.
The best underpinning for any program, based on both experience and research, is the final source-number 14. As Dr. Terrie Temkin, a nonprofit organizational governance specialist, suggests: “An organization that counts on getting 25 percent or more of its income from any one source is crossing into a danger zone.” Applying the 25 percent rule to the program level, as much as possible, although challenging, helps keep individual programs out of the danger zone, too.

By looking at your income options, combining the approaches listed above and determining what will work for your program, you can begin to form a sustainable income plan. Although identifying your approaches is only the first step in developing a income plan, selecting approaches can guide you to design an income pie chart with a lot of slices. Such income pie charts help your leaders say with confidence: “This is so good, that we must take whatever steps are necessary to create an intentional income plan to fund it.”