How to Get Your Giving Right
In this month’s Waccamaw Wisdom, Karen Minogue unpacks a recent study on philanthropy, and emphasizes the importance of how Waccamaw Community Foundation lives its mission to connect donors to the causes they care about. Suggestions for future topics are always welcome at [email protected].
“To give away money is an easy matter and in any man’s power. But to decide to whom to give it and how large and when and for what purpose and how is neither in every man’s power nor an easy matter.”—Aristotle
According to U.S. Trust’s James Moore in Getting Your Giving Right, adopting philanthropic best practices can make one’s charitable giving more impactful and more satisfying.
For centuries, across all cultures and lifestyles, philanthropy has been an integral part of society, creating and sustaining great educational and art institutions, human service organizations and much more. Today, many people who give to charity are doing so in new ways.
People of wealth believe philanthropy is the path to effecting positive social change, but many are not sure their gifts are having the impact they desire. According to Moore, the 2016 U.S. Trust® Study of High Net Worth Philanthropy profiled the philanthropic behaviors, attitudes and priorities of wealthy donors and found that 91% of American high-net-worth households donated to charity in 2015, giving ten times more on average than the typical American household. Of note is that half of wealthy individuals also volunteered their time at one or more charitable organizations, and more donors of wealth (63%) reported greater personal fulfillment from volunteering than from giving (42%).
High-net-worth donors appear to put a premium on charitable giving as a means to achieving the greatest potential for strengthening their communities. And they cited charitable giving (45%) and volunteering (31%) above political contributions, socially responsible investing, and other means of effecting change.
But Here’s the Challenge
The study indicated that of those surveyed, 67% said identifying the causes they care about and deciding where to donate are their biggest challenges. That’s where Waccamaw Community Foundation’s tagline really ties into the 2016 U.S. Trust® Study of High Net Worth Philanthropy. Our tagline is “connecting donors to the causes they care about.” Each and every day, that is our mission. We help donors create meaningful connections to the causes they care about, ensuring their giving is impactful and sustainable over the long term!
Ways Waccamaw Community Foundation Can Assist
We help individuals connect to what is important to them, predicated on their values and interests.
If someone is interested in a certain field (such as the arts, education, historic preservation, health or human services) but does not know exactly which charities to support, we provide well-researched data to help them construct their charitable giving plan. We can even set up a site visit to an organization so the prospective donor can put his own set of eyes and ears on the organization and its programs.
Then, we help them establish an endowed fund that will support the causes dear to them long after they’re gone, by providing a stream of income to nonprofit organizations of their choice. This supports and enhances the missions and long-term financial sustainability of the organizations they care about most.
The study also indicated one of the top motivations for wealthy donors is to make a positive impact on society, yet the vast majority of donors do not monitor or evaluate the impact of their giving. Of those that do, only 44% believe their giving is having the intended impact.
That’s where Waccamaw Community Foundation can also be helpful. We monitor the grantmaking from donor funds, conduct site visits to nonprofit organizations, and evaluate the effectiveness of grants made to ensure the work meets the donor’s philanthropic objectives. Donors want to make a difference, and we help them accomplish this. Consequently the more personally engaged donors become in giving, the more fulfilled they feel, and they will likely give more to the causes important to them. It’s a win-win for charities and a win-win for the donor.
Moore states that “Deeper knowledge of philanthropy also corresponds with a greater adoption of philanthropic best practices, which might explain why knowledgeable donors reported higher levels of confidence in the efficacy of their giving than less informed respondents. For example, 16.7% of “novice” households consulted with a philanthropic advisor, compared with 29.5% of “knowledgeable” households and 37.1% of “expert” households. Similarly, donors’ knowledge level corresponds with their use of charitable trusts, donor-advised funds and private foundations.”
While every donor has different priorities, virtually everyone can increase the impact of their giving — and the satisfaction they derive from it — by taking the following actions:
- Establish goals and strategies that connect to your core values and areas of interest
- Conduct due diligence on potential gift recipients
- Evaluate the effectiveness of both the charitable organizations and their broader philanthropic effort
- Seek outside expertise if you have questions about the efficacy of your philanthropy
There is a core difference between charity and philanthropy. Charity is more about the process of gifting to nonprofit organizations, while philanthropy involves a more strategic approach to giving and effecting change. Thoughtful giving and philanthropy done well is more likely to motive the donor to give in the first place. Let Waccamaw Community Foundation assist you on your journey to philanthropy done well.
One of the most rewarding things one can do is to give back. Including charitable giving as part of a well thought out financial plan is not only emotionally gratifying – it can reduce estate taxes too. Waccamaw Community Foundation is your first resource and partner in all things charitable. Karen Minogue is poised to help you set up a charitable fund in as little as one day to support the causes you care about. Call Karen at 843-357-4483 or e-mail her at [email protected] to find out more.
The purpose of this blog is to provide general gift, estate, and financial planning information. Always discuss your plans with your attorney, accountant, or financial advisor.
Additional Important Information
The 2016 U.S. Trust® Study of High Net Worth Philanthropy is based on a nationally representative random sample of 1,435 wealthy donors, including, for the first time, deeper analysis based on age, gender, sexual orientation and race. The study is based on a survey of U.S. households with a net worth of $1 million or more (excluding the value of their primary home) and/or an annual household income of$200,000 or more. Average income and wealth levels of the participants in the study exceeded these threshold levels; the average income and wealth levels of study respondents was approximately $331,156 and $16.8 million, respectively.