Wishful thinking is a wonderful thing. Many people feel the pandemic is over. It isn’t. But here we are, nevertheless, clawing our way back to our old habits because we desperately want to return to normalcy. But can we?
It only takes about 21 days to form a new habit. Then, a new habit usually takes a little more than 2 months — actually, 66 days — and as much as 254 days until it’s fully formed.
Like wearing a mask, staying six feet apart and washing your hands. Still do these things?
Most times, we don’t even realize we do certain things; we just do them mechanically, much like reaching for our masks. Many people feel that is a habit they don’t mind breaking.
But this habit we don’t ever want to break. We have a habit of unselfishly giving to those who truly need our help. In fact, we give the biggest share of donations to those in need because, by nature, Americans are the most generous nation.
The Pandemic Stretched Us, but We Didn’t Break
It is so encouraging to learn that nearly 50% of wealthy households made donations last year in direct response to the pandemic. Many of our Hefren-Tillotson clients participated. People far and wide focused on the needs of their local communities.
Of the wealthy households that increased their giving for basic needs and medical care, 90% directed their donations to local organizations, 35% supported other U.S. nonprofits outside their community, and 15% gave to international groups.
Of those that gave to religious organizations, 16% gave more; and for donations to nonprofits focused on education, the arts, the environment or other areas, 12% boosted their contributions, CNBC’s Sarah O’Brien reported.
You Can Count on the Human Spirit to Find a Way
Charitable giving was down most among lower-middle-income households. Seventy-three percent of U.S. adults say they donated money to a charitable organization in the past year.
A Gallup poll found a decline in charitable activity since 2017 that related to changes in tax laws as well as the coronavirus. In 2020, more Americans claimed the standard tax deduction than they did in 2017, and did not get a direct tax benefit from donating to charity, as they would have in the past.
Most affluent Americans—about 90% of them—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. As such, the gap in the percentages of upper- and lower-income Americans giving to charity has swelled from 19 points to 31 points.
Changes in Percentages Making Charitable Donations, by Annual Household Income:
|$100,000 or more||92||87||-5|
|$40,000 to $99,999||90||78||-12|
|Less than $40,000||73||56||-17|
Sure, it’s about money, but also about priorities. If we can give, we should, and we do. One week after Thanksgiving 2020, for example, people in the U.S. reportedly donated nearly $2.5 billion. And that’s an increase of 25% from the year before.
A 2021 study surveyed 1,626 households and defined affluent as those with an annual household income of more than $200,000 and/or a net worth greater than $1 million, not including the value of their primary home.
The Type of Giving isn’t as Important
Not to be overlooked, 60% of Americans say they have donated food and 13% say they’ve given blood in the past year. Hunger- and health-related charities have seen increased giving during the pandemic, experts say.
“The food banks and the Meals on Wheels, the food pantries, have had their demand grow tenfold,” says Jan Masaoka, chief executive of the California Assn. of Nonprofits. “And in many cases their donations have also soared. Individuals always open their hearts and their checkbooks in a disaster,” Masaoka said. “And this is the biggest disaster.”
No one individual has given more than MacKenzie Scott. After finalizing her divorce from Jeff Bezos in 2019, MacKenzie has given away more than what all but five of the country’s biggest givers have in the entire lifetimes, according to Forbes.
In total, 25 billionaires have given an estimated $149 billion to charity over their lifetimes so far. They remain worth a collective $799 billion. And they have plenty more to go.
Goodwill of North Florida, for example, received $10 million. In July and December 2020, she announced a total of $5.8 billion in grants to 500 different groups across the country.
“The pace and scope of MacKenzie Scott’s charitable giving is staggering, Forbes reported.
Tax-conscious investing and responsible giving requires a master plan. Call us today at Hefren-Tillotson to learn about how our MASTERPLAN® can work for you.