MAKING A DIFFERENCE

Philanthropy Today

Key Takeaways:

  • Begin to focus and maximize your charitable giving with a ”big picture“ understanding of philanthropy today.
  • The great majority of charitable giving in the United States—81 percent—is done by individuals and will bequests.
  • The top recipient organizations are religious organizations, educational institutions and human services groups.
  • Leading motivations to give by high-net-worth households include a belief that their giving can make a difference, feeling financially secure and knowing that organizations are efficient in their use of donations.

To make wise decisions about your charitable giving, it’s useful to start with an understanding of philanthropy today. How much are others giving? Where are they giving? What are their motivations? With this perspective in mind, you will be ready to undertake a thoughtful process that will focus and maximize your own giving.

In 2011, total charitable giving in the United States amounted to $298 billion. The great majority of this amount—81 percent—was from individual giving and charitable bequests. The remaining 19 percent was from giving by foundations and corporations.¹

Where is all this money going? According to research, these are the top five types of recipient organizations:

  1. Religious organizations (received 32 percent of all charitable donations in 2011)
  2. Educational institutions and organizations (13 percent)
  3. Human services groups (12 percent)
  4. Grant-making foundations (9 percent)
  5. Health organizations (8 percent)

Rounding out the list of major recipients of charitable giving were public society benefit organizations (such as The United Way and donor-advised funds); the arts, culture and humanities; international affairs organizations; and environmental/animal organizations.

You can’t say yes to all the causes that interest you or all the charitable requests you receive, so you need to decide what motivates you most to give. A study of high-net-worth households found these to be the top motivations behind their charitable behavior:²

  1. Believing that their gift can make a difference (cited by 72.4 percent of those surveyed)
  2. Feeling financially secure (71.2 percent)
  3. Knowing an organization is efficient in its use of donations (71.0 percent)
  4. Funding the same organizations each year (65.9 percent)
  5. Giving back to the community (64.1 percent)

Other important motivators include political and philosophical beliefs, volunteering at a particular organization, and giving spontaneously to support a need.

¹ Giving USA 2012: The Annual Report on Philanthropy for the Year 2011—Executive Summary, The Center on Philanthropy at Indiana University. Published by Giving USA Foundation.

² The 2010 Study of High-Net-Worth Philanthropy,The Center on Philanthropy at Indiana University.