Affluent people increased their donations to charity last year and embraced giving to new types of causes — while also sticking with some tried-and-true favorites.
Wealthy households donated an average of $43,195 in 2020, according to a newly released survey on high-net-worth people’s charitable giving from Bank of America /zigman2/quotes/200894270/composite BAC -1.74% and the Lilly Family School of Philanthropy at Indiana University. That’s up nearly 48% from 2017, the last time the survey was conducted, when affluent households gave an average of $29,269.
By comparison, donor households in the general population donated $2,581 on average in 2018, the latest year for which data on overall giving is available. The median donation amount by affluent households increased to $3,000 in 2020, up from $2,150 in 2017. The median donation amount for all households was $850 in 2018.
In other words, “in 2020, on average, the total amount given to charity by affluent donors was 17.5 times more than the amount given to charity by donors in the general population (in 2018),” the researchers noted.
The Bank of America and Lilly Family School survey was conducted in January 2021 and asked about charitable giving in 2020. The surveyed households had a net worth of at least $1 million (excluding the value of their primary residence) and/or an annual household income of $200,000 or more.
“Charitable activities last year and into this year reflect unwavering commitments by philanthropists to give in good times and bad, and to address societal issues as well as challenges faced in their local communities,” said Katy Knox, the president of Bank of America Private Bank.
Wealthy donors’ favorite causes
Affluent donors were most likely to donate to charities involved in basic needs (as in, helping people with food and shelter), religion and health, the study found. That’s been the case in previous versions of the survey as well, the authors noted.
However, there’s a discrepancy between which groups wealthy donors are most likely to donate to and which groups receive the largest share of wealthy donors’ dollars. Charities involved in religion, basic needs and education (both K-12 and higher education) got the most funding from wealthy donors.
“Basic needs charities were supported by the greatest proportion of affluent households; however, in 2020, religious organizations received the highest share of dollars contributed by affluent donors (32%), with only 20% of affluent dollars going to basic needs organizations,” the authors wrote.
Wealthy donors were more interested in racial justice than in previous years
Last year’s pandemic and calls for racial justice changed how wealthy donors gave. They focused on giving in their own communities , and supporting racial and social justice causes became more important to high-net-worth households, the survey found.
The share of affluent households who reported making donations to support “Black/African American causes and/or organizations” went up in 2020 to 11.4%, compared to 6.5% in 2017. Affluent households were more likely in 2020 (8.7%) to say supporting social and racial justice was important than they were in 2017 (5.8%).
Wealthy individuals said the public policy issues that mattered the most to them — regardless of whether they donated to organizations working on those issues — were education, health care, climate change, poverty/income inequality and animal rights.
That’s generally in line with the 2017 findings, “the only difference being that poverty/income inequality has risen in importance, while the economy has fallen out of the top 5 since 2017,” the authors said.
Why wealthy people’s giving choices matter
One reason to pay attention to the giving preferences of America’s affluent: Though they make up a small portion of the population, wealthier households have an “enormously disproportionate impact on charitable giving,” accounting for about two-thirds of household giving in the U.S., the report authors noted in their first version of the study in 2006 .
Lilly researchers did not have an updated version of that statistic immediately available, but more recent research suggests that wealthier households continue to dominate charitable giving in the U.S.
Households with higher incomes, more wealth and higher education levels were more likely to donate in 2018 than their less well-off and less-educated counterparts, according to a separate Lilly Family School of Philanthropy study of long-term giving trends. Nearly eight out of 10 households with wealth levels of $200,000 or more gave to charity; while less than four in 10 households with wealth levels of $50,000 or less did so.
Though the country as a whole gave a record amount of money to charity in 2020, there’s another worrying trend running parallel to that one: The share of people in the U.S. who donate to charity has fallen over the past two decades, and just under half (49.6%) of the population gave in 2018, the long-term giving study found. In 2000, 66.2% of people in the U.S. donated.