More women are paving the way for philanthropic leadership in households, according to a new study released Tuesday by the Fidelity Charitable Gift Fund.
"Women have always had a hand in their household's charitable outreach. But that role is evolving as women increasingly create their own wealth and become the beneficiaries of wealth transfers because they live longer," said Sarah Libbey, president of the Fidelity Charitable Gift Fund. "As a result, women are stepping up to take on more philanthropic leadership roles."
The study looked at the giving behaviors and attitudes of more than 1,000 adults who donated at least $1,000 in 2007 and a subset that gave over $5,000 that year. Almost half of women surveyed say they have the decision-making role in their households for both how much money to donate to charity and which charities to support.
As a group, the study found, high-income women (those with annual household incomes of at least $150,000) are more likely than other donors to give publicly, rather than anonymously. They are more likely to use giving vehicles such as donor-advised funds, charitable-remainder trusts and private foundations; they are most likely to use securities for donations; and they also are most likely to want guidance from a financial advisor regarding charitable giving.
Furthermore, high-income women are more likely than others to use securities for donations (7 percent versus 4 percent of all donors). These women are also more likely to say they want guidance from a financial professional on charitable giving (12 percent versus 9 percent of all donors). In addition, they are more likely to use giving vehicles such as donor-advised funds, charitable-remainder trusts and private foundations (5 percent versus 2 percent of all donors). They are more likely than any other group to support health and science causes (15 percent versus 7 percent of all donors) and to give additional money during challenging economic times (35 percent versus 27 percent of all donors).
The Gift Fund divided survey participants into four categories based on responses:
The majority of those surveyed (52 percent) fell into the "mainstream contributor" category. This group is the least likely to give more in challenging economic times because of greater need. When decreasing giving year over year, they are the most likely to keep the same number of charities and just decrease the amount they give. They are the most likely to know in advance which charities to give to. Their average total donations in 2008 were $6,842.
One third (29 percent) of the survey participants fell into the "empathetic giver" group. These people give the most in challenging economic times because of need. They are the most interested in creating a family tradition of charitable giving by engaging their children and spouse. They are the most likely to respond to a cause when personally touched by a disease, illness or tragedy. Their total donations in 2008 averaged $7,287.
Just 15 percent of survey participants are "reactive contributors." This group gives the smallest donations as a percentage of income. They are the most likely to cut back on charitable giving in challenging economic times. They are the least likely to think of charitable giving as part of their overall financial plan. Their total donations in 2008 averaged $3,687.
The Gift Fund found that only 4 percent of its survey participants are "pioneering givers." They are the most likely to contribute to organizations that are lesser known or to support new causes. They give away the most money as a percentage of their income. They use credit cards and securities for donations more than any other group. They are more likely to be influenced by a philanthropist in the news and the most likely to want guidance from a financial advisor regarding charitable giving. Their total donations in 2008 averaged $7,347.
What's the latest in chartible giving strategies that advisors need to know about? Stay tuned. Read Boomer Market Advisor's August 2009 issue coming soon!