A Century of Service. Giving for Good.

Research Reports Wealthy Individuals are Increasingly Likely to Seek Counsel in Charitable Investment, Assesses Giving Habits

The Center on Philanthropy at Indiana University, in partnership with Bank of America Merryll Lynch, recently completed a bi-annual study on the giving habits of high net worth individuals that pointed to some interesting attitudes and behaviors:

  • The study examined trends in charitable advice sought by wealthy donors. Consistent with trends observed in previous studies, the 2010 study witnessed notable increases in donors’ use of accountants (68 percent) and financial/wealth advisors (39 percent) to help them make charitable giving decisions. High net worth households also consulted with nonprofit personnel (24 percent) in their charitable decisions around philanthropic mission definition and creation. More than 90 percent of wealthy households initiated the discussions with their advisor, and 85 percent were satisfied with the advice given.
  • More than 16 percent of wealthy households gave to giving vehicles such as private foundations, donor-advised funds and charitable trusts in 2009, and the average giving amount to these vehicles increased by 21 percent, from $62,680 in 2007 to $75,867 in 2009.
  • The study examined high net worth households’ levels of risk tolerance among both their personal and philanthropic investments (e.g., private foundations, donor-advised funds and charitable trusts). The results show that, while 35 percent of wealthy households cited a willingness to tolerate above-average or substantial risk in their personal investments, only 23 percent reported these high levels of risk tolerance when it comes to their philanthropic investments.
  • Furthermore, while only 10 percent of households reported they were not willing to take any risk in their personal investing, one quarter (26 percent) cite being completely risk averse with their philanthropic investments.

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