October 30, 2018; ThinkAdvisor
The latest of US Trust’s biennial reports on high-net-worth (HNW) donors has just been released. The study, performed in conjunction with IUPUI’s Lilly School of Philanthropy, shows that very little has changed in the last few years save that the number of these high-net-worth individuals and the amounts they give are rising, keeping pace with the growing number of billionaires in the world and the widening global wealth gap. But you probably already knew that. If you didn’t, Patrick Rooney, also of IUPUI, wrote about it here.
So, what might you not yet know that would help you attract a donor rich as sin?
- HNW donors gave $29,269 to charity in 2017, which was 15 percent more than the $25,509 they gave in 2015. Conversely, the average gift from all other non-mega-rich households declined to $2,514 from the $2,520 reported in 2016. This is not especially surprising in light of said growing wealth gap, but it is an enormous danger to democracy for increasing portions of philanthropic money to be coming from a miniscule portion of the population—who, by the way, also make healthy donations to politicians.
- These donors volunteer at approximately twice the rate of the general population. This may not mean that they are more worthwhile people, but that perhaps not having a second or third job leaves one a bit more available. Fifty-six percent of wealthy women volunteer, while only 41 percent of men do—except if you are Latinx, in which case you volunteer at an even higher rate of 60 percent. Twenty-four percent of respondents say their volunteer time includes board service and that they give more where they serve. It should be said, however, that the placement of HNW individuals on a board as a core element of one’s business plan is worse than unproven in most types of nonprofits. One study suggests that the strategy has a reverse correlation to revenue in some kinds of organizations.
- Forty-nine percent of high-net-worth givers do not yet have a strategy to guide their giving, so you still may have a shot. Just remember that their numbers, while higher than last year, are few, and they give where they live—and, at least half the time, according to this study, to organizations they know personally.
- The last tip we’d like to pass along from the study is that reputation matters to donors—and therefore, in these transparent times, so does integrity. This is a good tip whether or not you are trying to attract a HNW donor, of course, but it’s a point worth repeating.
The rest of this study’s insights are likely things you have seen before if you track high-net-worth donors. We’ll leave you to access it at your will and you may also want to listen to this Tiny Spark podcast from NPQ with Anand Giridharadas, the author of Winner Take All .—Ruth McCambridge