There are many surveys highlighting how different age groups hold contrasting views about money, work, play and social life. So it's perhaps inevitable that this applies to philanthropy and the views of HNW individuals in the US.

The vast majority (91 per cent) of affluent Americans donate to charity, but motivations, priorities and strategies vary by generation and gender, according to new data from Bank of America Private Bank. 

Direct giving with a financial contribution is the most common form of philanthropic involvement. However, younger donors (ages 21 to 43) prioritize direct action, such as volunteering, fundraising, mentorship and sitting on boards. 

The survey of 1,071 HNW respondents comes at a time when private banks and other organizations advising HNW individuals need to figure out how to adjust their offerings to a rising generation. (Those surveyed were at least 21 years of age with a minimum of $3 million in investible assets, excluding a primary residence.)

The bank’s analysis also coincides with how, in the latter stages of the year, attention often turns toward philanthropy, such as new causes or structures and channels for giving. In some respects, the role of the philanthropy advisor is no longer a niche area for wealth managers and private banks, but a top-line service. (Here is an article from last November about different experiences in philanthropy in the US and Europe.)

“Our 2024 study reveals a common thread among high net worth individuals: a strong desire to make a positive change with lasting impact,” Jennifer Chandler, head of philanthropic solutions at Bank of America Private Bank, said. “However, responses also make it clear that there’s more than one way to achieve that goal. Generational and gender experiences shape world views and values, influencing cause selection and how people give.” 

When asked about their reasons for giving, all generations are motivated by making a lasting impact (69 per cent older respondents versus 63 per cent younger ones). However, older respondents are more than twice as likely to be driven by a sense of obligation (56 per cent older vs 25 per cent younger).

Younger donors give to causes related to homelessness (41 per cent younger vs 21 per cent older), human rights/social justice (33 per cent vs 18 per cent), climate change/environment (32 per cent vs 17 per cent) and the advancement of women and girls (21 per cent vs 15 per cent).

Older donors tend to prioritize giving to religious organizations (41 per cent older vs 18 per cent younger), animal welfare (32 per cent vs 25 per cent), military (24 per cent vs 15 per cent) and cultural/artistic conservation and creation (22 per cent vs 12 per cent).

One finding was the "rise of visible giving," with responses from younger people suggesting that they have less concern about the loss of privacy than their older peers.

“It’s well documented that members of the Millennial and Gen Z generations use social media in greater proportions than their elders. What I would propose is that the study findings [show] a `please join me’ tendency rather than any specific lack of concern about privacy,” Bill Jarvis, Philanthropic executive at Bank of America Private Bank, told this news service. “With respect to older generations, it is also possible that they may already have made their public philanthropic mark earlier in life (e.g., name on building or scholarship) and may feel that more recognition is not required at this stage.

Vehicles 
As many are inheritors of wealth, younger donors surveyed are more likely to use giving vehicles, including charitable trusts (36 per cent younger vs 7 per cent older), family foundations (25 per cent vs 3 per cent) and donor advised funds (22 vs 8 per cent).

Younger donors are more likely than older donors to gauge the success of their philanthropic efforts by public recognition (27 per cent younger vs 8 per cent older). Additionally, 42 per cent of younger donors say they are likely to associate their names with philanthropic efforts, while 69 per cent of older donors give anonymously.

Gender divide
Men are twice as likely to become involved in philanthropy because of their spouse/partner’s ideas (16 per cent men vs 8 per cent women). Men are slightly more likely to give to causes related to hunger and poverty (45 per cent men vs 40 per cent women). Women are significantly more likely than men (23 per cent women vs 12 per cent men) to direct their support toward causes supporting the advancement of women and girls.

Women shoulder the responsibility of introducing their children to philanthropy. When asked who is more likely to teach or talk to their children about participating in philanthropy, 46 per cent of women point to themselves, while only 35 per cent of men say the same. 

FWR asked the bank about how the pandemic has affected the sector.

"Some trends that emerged during the pandemic – for example, the surge in unrestricted giving – appear to have waned or returned to the donor-restricted giving pattern that prevailed before, notwithstanding the rise of some very visible 'trust-based' megadonors," Jarvis replied. "On the other hand, some trends such as issues-based philanthropy, where instead of giving to the same organization year after year the individual or family identifies issues that are important to them and then seeks nonprofits that address those issues, seem to have remained. Again, this latter trend appears to be driven by Next-Gen members, who are more likely to practice issues-based philanthropy than their elders, who typically practiced organization-based philanthropy."

Skepticism
The survey also found that 88 per cent of younger donors think their generation is prepared to assume philanthropic leadership, and 86 per cent  think that the next generation will surpass the effectiveness of previous generations.

The respondents are a nationally representative sample of the US HNW population and not necessarily clients of Bank of America or its wealth and investment management businesses.