Millennial donors on average recommend higher grant dollars to charities via donor-advised funds (DAF) than their older counterparts but are also unsure about how to go about giving, according to a new study by Vanguard Charitable.
“An Inside Look” examines 15,330 donors over a 10-year period that gave to charities using Vanguard’s DAF. Millennials/Generation-Xers recommended grant dollars of $9,065 compared to averages of $6,979 for Traditionalists and $7,877 for Baby Boomers. The minimum grant from Vanguard Charitable is $500.
At 13 percent, Millennials/Generation-Xers by far comprised the smallest portion of Vanguard’s donors compared with Baby Boomers, at 44 percent, and Traditionalists (born before 1946), at 31 percent.
“The fact that they are small in number – yet giving so substantially – shows they are very engaged donors,” said Ann Gill, chief philanthropic officer at Vanguard Charitable. “They have chosen at a younger age to get started with their giving, which means to us that they are very interested in making a difference, not just managing their wealth,” she said.
Additionally, the study found that among Millennial donors, the average compound growth rate of dollars granted was 29.6 percent, compared to 16.8 percent for Traditionalists and 22.9 percent for Baby Boomers. Gill also revealed that Millennials are more likely to follow up with charities they fund and may even be involved in the implementation of their charitable dollars. “They’re focused on results, which we believe translates into higher dollar grants,” she said.
Despite the generosity with their recommendations, Gill said she has consistently heard from younger donors that they are unsure of the best ways to go about giving when donating money outside of their DAFs. Specifically, she said they have asked where they should give, how much is the right amount to give, and how they can work with other donors and nonprofits.
Gill said that her best recommendation to young donors is to serve on nonprofit boards. She highlighted three reasons this would help them be more prepared to give:
- Learn the needs of charities and how they can address these needs in their own giving;
- Better understand how nonprofits function, the fundraising process and how to creatively solve problems with minimal resources; and,
- Gain insight from donors with years of experience by interacting with tenured board members.
“With this experience, they may find it easier to define their charitable goals and mission moving forward,” said Gil, who added that volunteering at a nonprofit in another capacity would provide the same benefits.
For more information on the results of Vanguard’s study or to access the full version of “An Inside Look,” visit https://www.vanguardcharitable.org/inside_look_paper/
