The landscape of charitable giving is undergoing a transformative shift, largely driven by the aspirations and values of younger generations. Wealthy millennials and members of Generation Z are challenging traditional philanthropic norms, viewing themselves not merely as donors but as active change-makers and advocates for social causes. A recent study by Bank of America Private Bank highlights this evolution in philanthropic activity, offering insights into how these young, affluent individuals engage with charitable giving in ways that diverge significantly from their predecessors.
The research indicates that affluent individuals under the age of 43 are increasingly inclined to engage deeply with the causes they support, often prioritizing involvement over mere financial contributions. Unlike previous generations, these young philanthropists emphasize their roles as active participants—volunteering, mentoring, and fundraising within their social circles. This shift marks a significant change in how wealth is utilized for philanthropic purposes. Dianne Chipps Bailey, a managing director at Bank of America Private Bank, notes that these younger givers see themselves as holistic agents of social change, eager to deploy their resources for maximum impact.
This demographic, consisting of early-career wealth builders and inheritors, seems to find purpose in the act of giving itself. Their motivations are often fueled by a desire for personal growth and a reciprocal influence from their peers, distinguishing them from older generations who may view philanthropy more through the lens of obligation or duty. In fact, approximately 91% of wealthy respondents reported contributing to charitable causes, yet the underlying motivations varied significantly by age. For those under 43, the drive to contribute emerged from a blend of social responsibility, self-education, and community involvement.
A striking characteristic of younger wealthy donors is their preference for non-monetary contributions. These individuals are not only more likely to volunteer their time but are also actively involved in securing donations from others, exhibiting a form of grassroots fundraising that is both collaborative and community-oriented. This contrasts sharply with older donors, who are predominantly motivated by a sense of obligation and tend to give without seeking active engagement in the charitable organizations they support.
The “five T’s” of philanthropy—time, talent, treasure, testimony, and ties—are redefined by younger generations, who favor involvement across multiple dimensions instead of solely focusing on financial donations. Bailey suggests that as millennials and Gen Z ages and accumulate greater wealth, their inclination to remain engaged in all facets of philanthropy may persist, indicating a sustaining legacy for this approach toward charitable giving.
Shifting Focus: Causes That Resonate
Another noteworthy finding reveals how the causes championed by younger affluent individuals differ markedly from those preferred by older generations. Younger donors demonstrate an affinity for social justice, environmental issues, and the advancement of marginalized communities. For instance, they are twice as likely to support initiatives related to homelessness or climate change, as opposed to traditional causes such as religious organizations or military charities favored by their older counterparts.
This generational difference can be attributed to the broader societal context in which millennials and Gen Z have come of age. Experiences during the pandemic and heightened awareness of systemic inequalities have shaped the worldview of these young individuals, resulting in a stronger commitment to social issues. This sense of urgency is not fleeting; it represents a sustained engagement with pressing global challenges, transforming philanthropy from a passive act into a pivotal component of their identities.
The implications of this evolving philanthropy landscape extend to wealth advisors and nonprofit organizations, emphasizing the importance of understanding younger donors. As they inherit approximately $80 trillion over the coming decades, the need to engage effectively with this demographic will be crucial. Younger givers are more inclined to utilize structured giving vehicles such as charitable trusts, family foundations, and donor-advised funds. They seek knowledge and education about philanthropy as integral to their wealth management discussions.
To foster fruitful relationships, advisors must adapt their approach by celebrating young donors’ contributions and encouraging visibility in their philanthropic efforts. Unlike the older generation, who often prefer to remain anonymous, younger donors frequently expect recognition for their work. This newfound desire for validation in charitable efforts suggests that nonprofits and advisors should prioritize transparency and celebrate young philanthropists’ achievements as part of their engagement strategy.
The philanthropic landscape is undergoing a renaissance, led by younger generations who are redefining what it means to give. Their commitment to activism, community involvement, and a diverse range of causes signifies a monumental shift in charitable giving—a shift characterized by collaboration, engagement, and a strong sense of purpose. Understanding these trends is imperative for wealth advisors and nonprofits seeking to navigate the future of philanthropy successfully. Embracing this change offers opportunities for creating lasting social impact and forging meaningful connections with the next wave of donors.