The Bank of America has recently sponsored a study of high net-worth donors, researched and written by the Center on Philanthropy at Indiana University.

Almost simultaneously, the Institute for Jewish & Community Research located in San Francisco issued a report on Mega-Gifts in American Philanthropy.

My purpose in this article is not to compare the specific findings, but to glean nuggets of information that I believe should be of particular interest to those of us who are practitioners in the field.

Entrepreneurs give, on average, almost twice as much in a year as other wealthy individuals ($232,206 vs. $120,651).

The Bank of America study surveyed the philanthropic giving of the wealthiest 3.1% of households in the United States - those who have an annual income of $200,000 or more, or have a net worth of $1 million or more. There were 1,400 responses to the survey. This study included foundations and donor-advised funds as recipients of gifts.

The Jewish Institute study deals with actual gifts of $1 million or more from 2001-2003, (wherein 8342 such gifts were identified, with 719 being for $10 million or more). This study reports gifts made through foundations and donor-advised funds, but not transfers of funds into those vehicles. By comparison with the Bank of America study, these donors might better be described as the mega-wealthy.

Transmitting Values

Very wealthy households were also more likely to discuss philanthropy with their children (78.9%) and to allow their children to participate in charitable giving decisions (42.1%) than other wealthy households (see the first figure below). Very wealthy households were also much more likely to establish criteria for children's participation (42.1%) and to give their children funds to donate to charity (36.8%) than other wealthy households.

Tax Implications

Just under 50% of very wealthy households report that their donations would stay the same if they received zero income tax deductions for their charitable donations (see chart below). Very wealthy households, however, were more likely than other wealthy households to report that they would dramatically decrease their charitable giving if they received zero income tax deductions for their charitable donations (15.8%).

Click on the charts below to view in a larger format.