The next generation of high-net-worth donors will change the face of philanthropy, making it more impactful, more hands-on and more networked, according to a new study.
Gen X and Gen Y/Millennial members of wealthy families, those born between 1964 and 2000, stand to inherit some $41 trillion during the first half of the 21st century, according to research by the Johnson Center for Philanthropy at Grand Valley State University and 21/64, a nonprofit consultant that specializes in strategic philanthropy.
Much of this wealth, along with pre-bequest asset transfers and new wealth being created, will be available for charitable purposes.
The report, based on a national online survey of wealthy donors age 21 to 40 and in-depth interviews, found the following:
1. Values, not valuables, drive next-gen major donors. These values are often learned from older family members. Younger donors fund many of the same causes their families support and even give locally when this fits with their personal values. They use many of the same giving methods as their families, but also plan to explore new philanthropic and investing tools in the future.
2. Next-gen major donors see philanthropic “strategy” as the major distinguishing factor between themselves and previous generations. They intend to change how decisions are made and how research and due diligence are conducted. They want to use any necessary strategies, assets and tools for greater impact, and want to know that their own involvement contributed to that impact.
3. Once engaged, these next-gen major donors want to develop close relationships with the organizations or causes they support, offering their own professional or personal talents in order to solve problems together with those they support. They still want to offer their time, but in meaningful ways. They believe that collaborating with peers makes them all better donors, and extends their impact.
4. Next-gen donors are still figuring out what kind of philanthropists they want to be as they enter adulthood, wait to inherit independence on many levels and incorporate into their personas as donors the influence of earlier generations.