Organizations relying on a few resources may reduce costs but increase risks, as the net donations equal the total donations minus fundraising costs, while the donation cost rate equals the fundraising costs divided by total donations. Dependence on specific resources equals the sum of the top five resources divided by total expenses, while the integrity of fundraising equals the net fundraising plus the balance between the number of resources and their costs.

However, these financial challenges become compounded if overshadowed by other factors, such as serving the most needy communities, which poses a barrier for nonprofit organizations serving people with disabilities or low-income individuals, especially when they face challenges related to balancing the community on multiple fronts that far exceed the organization's mission. Some of these challenges include economic challenges, poor education, health issues, crime outbreaks, safety concerns, housing fears, business instability, or development decline in communities.

It is essential for organizations to understand the value of interaction between the economic and cultural contexts of low-income communities and the sustainability challenges they face to maximize strategies related to addressing these sustainability hardships and improving nonprofit services for high-need communities, which are considered unique challenges for nonprofits serving low-income populations using strategies to enhance financial sustainability.

Despite the importance of the concept of financial sustainability, it is, in fact, merely a result of the nonprofit organization possessing what is called financial capacity. The concept of financial capacity includes the charity organization having the tools that give it the ability to expand into opportunities and handle unexpected risks while managing its regular operations. Financial capacity has several internal and external aspects. Signs of internal financial capacity include the organization having income generation sources such as endowments, investments, sales of goods and services, memberships, and others. Signs of external financial capacity include having diverse sources of support for the organization. Experts believe that 60% of a charity's budget should come from at least 5 different sources as an indicator of the charity’s financial health.

Even with endowments, the nonprofit organization faces two significant challenges: first, serving communities with growing needs, and second, existing in a competitive sector where both old and new entities seek their share of the pie. The importance of discussing financial sustainability lies in the fact that most charitable organizations rely on external financial support sources such as governments, grant-making institutions, and merchants. Although generous, these sources are uncertain in the long run.

Financial sustainability is defined as the financial condition in which a charity organization is capable of continuing to achieve its charitable mission in the long term. Herein lies the importance of financial sustainability as a condition for the charity’s survival and its ability to effect the desired change on the ground. Money is the lifeblood of the charity organization and its vital vein.

Although financial sustainability is a prerequisite for the sustainability of the charity organization in general, the charity is required to balance achieving financial solvency and fulfilling its charitable mission. This is indeed one of the challenges facing the charity organization; the focus on enhancing the financial standing of the organization should not come at the expense of achieving the charitable mission for which the organization was founded, and vice versa.

Therefore, the leaders and executive directors of charitable organizations are called upon to adopt a strategic model that integrates between financial and capital performance efficiency in their organizations.

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