By Ted Grossnickle
A wealth of free information is available for download this week from the Center on Philanthropy at IU and Bank of America Merrill Lynch.
The release of their 2010 Study of High Net Worth Philanthropy provides details of the giving habits of high net worth households in the US including why they give, why they stop giving and how you can get them to give more.
The 75-page report is chock full of valuable information, but the more skimmable 10 page key findings also provides some great insights into the giving of high net worth households, including:
- Average charitable giving dropped 34.9 percent in 2009, after adjusting for inflation.
- Some charitable sectors saw increases in giving, including arts, environment/animal care, and international causes.
- Others saw significant declines, including 63.7 percent for health organizations, education and combined purpose organizations (such as United Way, United Jewish Appeal, or Catholic Charities)
- High Net worth households were more prone to give to general operation funds or a particular program than they were to support capital gifts (such as construction projects or equipment purchase) or endowment giving.
We have heard from donors, and this research study also certainly supports our experience, that high net worth donors are concerned about the uncertainty in the current tax situation.
The study reports that 67 percent of respondents indicated they would somewhat or dramatically decrease giving if income tax deductions were taken away. Repeal of the estate tax would induce 43 percent of respondents to somewhat or dramatically increase their charitable bequests.
Wanting to lure more wealthy donors to support your charity?
When determining where to give, high net worth households look for sound business and operational practices, acknowledgement of contributions, appropriate overhead expenditures, protection of personal information, and full financial disclosure.
Wondering why you may have lost some high net worth supporters last year?
The most frequent reason donors cited they stopped charitable support for an organization was after being too frequently solicited or asked for an inappropriate gift amount. This begs the question of how strategic you are being in your donor solicitation and if you are doing the appropriate level of research on donation requests.
I encourage you to download the report and put this information to use in your own planning arsenal.
Thank you to the Center on Philanthropy and Bank of America Merrill Lynch for this great addition to the philanthropic industry’s body of knowledge.