Tuesday’s official release of Giving USA indicates that total charitable giving in the U.S. increased by 4.4 percent last year, from $316.26 billion to $335.17 billion. While the continued rise in philanthropy is much to celebrate, what is most interesting to observe is where that money comes from.
Giving USA segments contributions by source: individuals, bequests, foundations, and corporations. According to the Lilly Family School of Philanthropy, which researches and authors the report, contributions from individuals account for 72 percent of the total.
However, for those willing to delve into the full 251-page report, further analysis yields additional information:
- Bequests can be loosely defined as wealth transferred shortly after an individual’s death. Although the underlying vehicle differs from a traditional philanthropic contribution, fundamentally, they come from individuals.
- “Foundations” is a category capturing independent, operating, and community foundations. Forty-eight percent of these contributions come from family foundations that are funded entirely by the members of a single family. In 2013, family foundations contributed $23.36 billion.
This additional information presents a new way to interpret the data:
This amount, representing about 87 percent of all philanthropic giving in 2013, suggests that the true impact of individual giving is much greater than may be immediately apparent.
Tapping into this potential requires a deep understanding of donor behavior, to which Giving USA provides additional insight. In 2013, foundations received 16.7 percent less money than the year before, suggesting that donors may be moving toward a direct engagement with the organizations to which they contribute.
As we explore in The Art and Science of Donor Development, successful engagement with individuals and their families has been and remains the greatest opportunity to raise philanthropic support for projects and programs. By connecting individuals and their passions to inspiring opportunities we are able to unleash this philanthropic energy to benefit both the donor and the organization.