The Latest Report on the USPS Financial Situation 

Discussions and Decisions from The National Postal Forum

By, Carmen Campbell  

I recently had the opportunity to attend the National Postal Forum, where leaders from across the mailing industry gathered to hear directly from the United States Postal Service about what is happening now, and what may be coming in the months ahead. 

As someone who has worked in print production for several decades, I can tell you this: USPS changes are not new. Postage increases, service updates, sortation changes and operational shifts have always been part of direct mail fundraising. 

But this moment is different. 

Not because direct mail is going away…it absolutely is not. And not because nonprofits need to panic… you do not. But because the USPS is working through a much bigger challenge than a typical postage increase. 

The Postal Service is in a deeply serious financial situation.  

Before recent financial adjustments, USPS leadership shared that the organization was projected to run out of cash as early as October 2026. Temporary relief has come through retirement plan adjustments and Postal Regulatory Commission approvals. But the current USPS financial model is not working long term. 

USPS is required to provide service across the country, reaching every ZIP code and supporting businesses, organizations and households of all sizes. That service is essential. USPS leaders say that the postal service “matters too much to stand still.” But the costs of maintaining that network, modernizing infrastructure, supporting employees and keeping delivery affordable continue to put pressure on the organization. 

For nonprofits, direct mail remains one of the most effective ways to reach donors, tell stories and raise support. USPS leadership recognizes that mail still matters. But they also know the organization has to dramatically change their structure in order to remain financially sustainable and operationally reliable. 

What is the USPS financial issue?  

USPS is facing urgent cash pressure. 

This is due to a combination of rising costs, years of underinvestment, declining mail volume in some categories, mandated service obligations and a pricing structure that does not fully solve the long-term financial challenge. 

For years, nonprofits have been trying to absorb rising postage costs while still keeping direct mail programs strong. A rate increase may sound small on paper, but when you are mailing thousands — or sometimes hundreds of thousands — of direct mail pieces, even a few percentage points can make a real difference in a nonprofit budget. 

For example, a 5% increase on a $100,000 postage budget would be an additional $5,000 annually. For larger mail programs, that impact grows quickly. And for nonprofits, every dollar matters because those dollars are ultimately connected to fundraising performance, ministry impact and donor communication. 

According to USPS leadership, postage increases will continue to be part of the future. But more importantly, postage increases alone cannot solve the problem. 

What is USPS going to do about it?  

At the National Postal Forum, USPS leadership talked about several ways they are working to stabilize the organization. The important thing to understand is that there is not one single fix. USPS is looking at a combination of service improvements, cost reductions, technology, volume growth and Congressional support. Here is more detail about each of these five solutions and what it means for nonprofits today:  

Focus #1: Improve Service  

In production, the word “service” matters a lot. We are not just thinking about how much something costs to mail. We are also thinking about when it enters the mail stream, when it arrives in homes, and how that timing affects a fundraising campaign. 

For nonprofits, timing can be very important. A direct mail appeal is often connected to a larger campaign strategy, seasonal giving window, or urgent need. So, when USPS talks about improving speed, reliability, consistency and visibility, that is something we at BDI are watching very closely. 

Focus #2: Improve Internal Efficiencies and Utilize Partnerships  

USPS leadership aims to operate with more discipline, making better use of its network and becoming easier to do business with. They also shared that a major network build-out phase is largely complete, and the next phase involves operating that network more effectively. 

Ultimately, USPS aims to have clearer processes, better communication, more consistent performance, and a system that is built more around customer needs.   

Focus #3: Grow Mail Packages and Volume  

USPS leadership believes that the future of direct mail marketing is tied closely to innovation, customer partnerships and the opportunity to grow the overall marketing ecosystem. That includes integrating physical mail with their digital channels, and leveraging customer-friendly tools like Informed Delivery, which allows individuals to preview their incoming letter-sized mail and track packages before they arrive at the mailbox.  

Focus #4: Improve Technology and Leverage AI 

USPS leadership is focused on leveraging AI as a tool to help improve responsiveness, speed, customer experience, and operational efficiency across their organization. At this point, the details around these technology advancements have not been shared.  

Ultimately, USPS is looking for ways to modernize not just its facilities and fleet, but also how it serves customers and manages operations. 

Focus #5: Congressional Support 

Despite the planned improvements listed above, Congressional support is still needed. The Postal Service is being asked to provide services that are not always profitable, and long-term sustainability will likely require broader structural support beyond what USPS can fix on its own. 

The full USPS plan is a combination of postage adjustments, cost reduction, better service, network optimization, technology, volume growth and Congressional support. 

What does this mean for nonprofits? 

Postage rates, delivery timing and USPS service standards all affect direct mail fundraising. 

If costs continue to rise, campaign budgets may need to be reviewed. If delivery patterns shift, mail timing may need to be planned more carefully. And if USPS introduces new tools or incentives that help connect direct mail with digital engagement, those may create opportunities for nonprofits to strengthen fundraising and marketing campaigns. 

At BDI, our Production team is continuing to monitor USPS updates, work closely with our vendor partners and look for ways to help our client partners mail as efficiently as possible. As more information becomes available – especially around final rates, service changes or operational updates – we will help our clients understand what it means for their campaigns. 

That may include reviewing postage assumptions, planning mail dates with greater precision, evaluating production timelines, or looking at new ways to integrate direct mail across channels to strengthen results. 

We know how important direct mail is to your fundraising program, and we also know how much pressure rising costs can put on nonprofit budgets. Our job is to stay informed, ask the right questions and help you make thoughtful decisions that protect both your investment and your results. 

If you are a BDI client partner or a Rescue Mission with questions, please feel free to reach out. We would be happy to talk with you and your team.