Someone who works on Wall Street might give about one-third less of his money to charity than someone in a more modest income bracket, and a new study reveals why that's the case.
A new SEI survey found that wealthy Americans who make $200,000 or more give 2.8 percent of their income to charity. Compare that paltry figure to those who take home $50,000 to $75,000 per year. They give an average of 7.6 percent of their discretionary income to charity, according to a study in the Chronicle of Philanthropy.
Those surveyed in the SEI study said their giving is deterred by three factors: uncertainty around how long wealth will last, shaky markets and lack of passion for a specific cause.
Research from Blackbaud has highlighted personal connection as a primary motivator for giving in general, pointing out that people say they are most likely to donate if they identify with a cause, or are solicited by a friend, family member or organization specifically.
It may sound trite, but there are actual steps to take in discovering a cause and donating efficiently and passionately to it. Jeremy Haimans of Purpose.com said the process behind giving should be thoughtful.
The founder of the online launchpad for social movements said in an email to Huffington Post last year: "Find something that makes you angry, gives you hope that things can change and then motivates you to take action. Anger without hope and action won't get you very far. Expect winning social change to be hard -- but remember that shared defeat is just as important as shared victory in building a sense of solidarity."
When it comes to gauging effectiveness of philanthropic endeavors, almost 65 percent of wealthy donors surveyed in the SEI study said social impact was the most important measurement, whereas just 20 percent consider the financial impact of their charitable activities.
The poll did show that 82 percent of wealthy families believe that having more money means one is more obliged to being philanthropic.
But while the wealthy may not be setting a stellar philanthropic example in general, a number of mega-rich people have raised the bar for serious giving by joining the Giving Pledge -- an initiative in which billionaires sign up to give away half their wealth to charity.
The Giving Pledge is opportunity for wealthy people to give more efficiently, Bill Gates, co-founder of the initiative, told the Wall Street Journal in September when a crop of new signatories including Netflix CEO Reed Hastings joined.
“This new group brings extensive business and philanthropic experience that will enrich the conversation about how to make philanthropy as impactful as possible,” he said. “Their thoughtfulness and deep commitment to philanthropy are an inspiration to me, and I’m sure to many others as well.”