The Pentera Blog
$27 Trillion Coming to Charity, New Study Predicts
A new study predicts $27 trillion coming to charitable organizations in the coming decades, much more than previously predicted, with an increasing trend for more lifetime gifts such as charitable trusts, though bequest totals are predicted to continue rising as well. The study identifies several implications for planned giving and nonprofit fundraising.
Researchers at the Center on Wealth and Philanthropy at Boston College predict the $27 trillion will come to nonprofits between 2007-2061, up more than $10 trillion from their 1999 study that predicted a coming "golden age of philanthropy." They said the higher figures are particularly surprising because of the 2008 recession that cost Americans trillions of dollars, and titled the May 2014 report, "A Golden Age of Philanthropy Still Beckons."
Of the charitable total, the researchers predicted that $6.3 trillion will be in charitable bequests and $20.6 trillion in lifetime gifts, a 12% increase in the "give while you live" trend. "The transfers … often involve donations to nonprofit organizations, family foundations, donor advised funds, and charitable trusts," the study states, "and present an opportunity for the potential donor to allocate even more than usual amounts to a broad range of charitable causes and to experience the results of these gifts during their lifetime."
The study identified these implications for nonprofit fundraising:
- "The wealthy donor usually plans these donations years in advance. It is during this planning period … when the donor is most appreciative for information and discussion with potential recipients …"
- "From the nonprofit viewpoint … an increasing amount of the wealth transfer will occur earlier than if all the transfer occurred through estates."
- "Wealth transferred … during the donor's lifetime reduces the value of the donor's final estate and thus reduces transfers through bequests."
"Despite the trend toward lifetime giving, it is both realistic and valuable for charities to remain encouraged about the potential for bequests," center director Paul Schervish, one of the study authors, said in a news release. "Charities should take whatever steps possible to obtain their share of the projected bequests and to expand the amount of bequests."
The full news release can be accessed here: http://www.bc.edu/content/dam/files/research_sites/cwp/pdf/Wealth%20Press%20Release%205.28-9.pdf
