As we enter the season of giving, recent findings by the Generosity Commission have shed light on a concerning trend. While charitable dollars are rising, the number of donors and volunteers continues to decline. This shift raises essential questions about the future of philanthropy and our role in fostering a robust and interconnected society.
Tax Changes and the Impact on Philanthropy
The 2017 doubling of the standard deduction led to fears that fewer individuals would benefit from itemizing their charitable contributions, potentially discouraging giving. Despite this, the overall amount donated to charities has continued to grow. However, these increasing contributions come from a shrinking pool of donors, highlighting a shift in the giving landscape.
Fewer Donors, Fewer Volunteers
A closer look at the numbers presents a sobering picture. The Generosity Commission reports that in 2008, 65.4% of U.S. households contributed to nonprofits. By 2018, this figure had fallen below 50%, a significant drop that mirrors a broader decline in civic participation. Volunteerism has followed this trend, with formal volunteering rates decreasing from 30% in 2019 to 23% in 2021.
Why Broad Participation Matters
This decline in participation, both financial and volunteer, poses challenges not only for nonprofits but for society at large. The Generosity Commission emphasizes the value of broad-based participation in philanthropy. Charitable giving and volunteerism are not just about financial support—they are about fostering civic engagement, building social connections, and working collectively toward shared goals.
Looking Forward
The Generosity Commission offers nine recommendations for reversing these trends, calling for renewed efforts to encourage participation at all levels of giving and volunteering. As we approach the holiday season, it’s a timely reminder that every contribution, regardless of size, is crucial in maintaining a vibrant, pluralistic society.
For a deeper dive into the Generosity Commission’s findings and recommendations, you can explore their full report here.
At Legacy Private Trust Company, we understand the importance of thoughtful philanthropy. Our charitable giving services are designed to help individuals and families support the causes that matter most to them efficiently and effectively. As a trusted fiduciary, we are here to guide you through the complexities of giving, ensuring your contributions align with your values and long-term goals.
This season, we encourage you to reflect on the value of participation in philanthropy—not just as a donor but as an active member of a connected community. Together, we can continue to make a meaningful difference.
If you are a Legacy client and have questions, please do not hesitate to contact your Legacy advisor. If you are not a Legacy client and are interested in learning more about our approach to personalized wealth management, please contact us at 920.967.5020 or connect@lptrust.com.
This newsletter is provided for informational purposes only.
It is not intended as legal, accounting, or financial planning advice.
