Only 9% of high-net-worth households reported that they would give less to charity over the next three to five years while almost a quarter, 24%, said that they expected to give more and 52% expected to keep giving at the same levels, according to early findings of the 2012 Bank of America Study of High Net Worth Philanthropy.
The outlook shows that while "there are certain pockets that are not as confident about their giving and their own economic circumstances," there is a high level of commitment to charitable giving as well as some optimism about the economy in the high net worth space, Una Osili, director of research for The Center on Philanthropy, BofA's partner in the survey, said in an interview with On Wall Street.
"This a good indicator that if you combine those two, 76% plan to hold steady or increase [their giving]. If you take that together with a lot of economic and financial indicators, that does seem that donors are expressing a very strong commitment to their philanthropy even in the more uncertain economic climate," Osili said.
Moreover, 71% of respondents said that they had a specific strategy for giving, indicating the importance of philanthropic causes among high net worth households, according to Claire Costello, national philanthropic practice executive at U.S. Trust, Bank of America Private Wealth Management.
"We see that [commitment] in several regards," Costello said. "Not only with what they're giving but that they report themselves to be increasingly more strategic about it, more deliberate about it. They're still deriving a great deal of fulfillment from it on a personal level as well as satisfaction by way of the achievements they're seeing from their own giving," she said. "All of that points to the fact that it's really embedded not only in our culture, but in our practices at least of the high-net-worth households around giving."
Early findings of the survey did not distinguish where donors were giving their money, but did indicate which issues which were most important to them. Education and healthcare ranked among the highest, beating out the economy, federal deficit and the housing crisis. That does not necessarily correlate to where their money goes, however, Costello said, but it does reveal donors' concerns.
"Nonetheless given the conversations and political discourse of the day, the fact that the housing crisis came in last and the economy came in third and the federal deficit came in fifth; we found to be particularly interesting given the issues of the day that education was paramount," Costello said.
The largest donations during 2011 went to religious causes (35.9%), followed by one-fourth to education and 8.3% to health-related causes. In the spirit of election season, the survey also asked about campaign contributions and found that more than 50% of high-net-worth households had given to political campaigns last year compared to 10% to 12% of the general population who made political contributions, according to the American National Election Study.
The full survey, which will be released Oct. 30, offers more insight into where donations go as well as other focuses such as volunteerism, a trend which The Center on Philanthropy has found to be on the rise.
"One thing I would emphasize is volunteering," Osili said. "That's something we've been seeing as an important trend in the charitable sector. High net worth households have not just been giving their funds and monies, but also their time."
Released biennially, the study takes into account the answers of 700 randomly selected households with an income of over $200,000 or a net worth of more than $1 million excluding the value of the home and defines philanthropy specifically as contributions to a 501(c) (3) organization.
"This is a very important demographic to study because the top 3% of wealth holders in this country give an enormously disproportionate amount of charitable dollars," Costello said. "So if you extrapolate upward from there, they are disproportionately responsible for influencing what happens in communities and in our world."
Register or login for access to this item and much more
All On Wall Street content is archived after seven days.
Community members receive:
- All recent and archived articles
- Conference offers and updates
- A full menu of enewsletter options
- Web seminars, white papers, ebooks
Already have an account? Log In
Don't have an account? Register for Free Unlimited Access