It appears the pandemic hasn’t dented charitable giving from wealthy households. Most affluent Americans — about 90% — gave to charitable causes in 2020, with a third of them giving more than in the past to organizations focused on meeting basic needs, according to research from the Bank of America and the Indiana University Lilly Family School of Philanthropy. Nearly half of them (47%) gave in direct response to the pandemic, whether by donating to charities, businesses or individuals.
For instance, both the number of grants and the dollar amounts gifted in 2020 from the bank’s donor-advised charitable gift fund increased by nearly 50% from a year earlier, which resulted in more than $500 million going to nonprofits.
Despite the increased giving from affluent households, there has been concern about the long-term viability of some nonprofits due to a pandemic-related decrease in funds coming in. A mid-year 2020 analysis by nonprofit tracker Candid suggested that up to 28% of nonprofits could shut down.
There were some shifts in charitable giving, the bank found. More wealthy donors supported local community needs than usual, and there was an increase in unrestricted gifts — those that the nonprofit can use how it sees fit instead of for a specific purpose required by the donor. There also was an increase in virtual interaction between nonprofits and donors.
As we continually discuss, donor advised funds are a great way to support your charities of choice and make a strong impact in the world, while also benefiting your tax situation. Check out our recent podcast with Elizabeth Goldstein at the Jewish Federation of Greater Washington as we discuss everything you need to know about donor advised funds. At Sherman Wealth, we are honored to be able to give back to the local community, including organizations such as So What Else, Nourish Now, A Wider Circle, and The Jewish Federation Of Greater Washington. What local charities are near and dear to your heart? Let us know at firstname.lastname@example.org.