Women are wealthier and making waves when it comes to philanthropy.
It may seem stereotypical, but women tend to be givers – to their families and to their communities – and the research bears this out. But the ways women give have changed over the decades. Women now control 51% of personal wealth in the United States, and that rise in wealth has led to a surge in effective female philanthropy. In short, women are changing the philanthropy game.
The early days
Over the past 250 years, American women have devoted their time, energy and money to various causes. Early on, they helped take care of soldiers and their families during wartime. In the 19th century, the focus expanded to widows and children, especially the poor. Toward the end of the 1800s, organizations specifically designed to support women emerged, including the YWCA and the National Association for Colored Women. Both offered education, support and training for women. During these early days, women’s giving was often tied to their husband’s or family’s wealth, and their efforts helped shape American society.
In the 1970s, as more and more women began going to college and working full time to better their economic and intellectual standing, they gained more power to promote women’s issues – which led to a large number of organizations developed for and by women. More than 100 women’s funds had been created by the 1990s, many with a focus on supporting women. Women are expected to control $22 trillion of personal wealth in the United States by 2020. And with women outliving men by an average of six years, it’s likely they’ll be making major decisions around the transfer of wealth and gifts to charity. Women are increasingly becoming a powerful financial force, and more and more are using their money as a way to make positive changes in society.
Donors to women’s funds and foundations – most of whom are women – have several distinct characteristics compared with general high-net-worth donors, according to the IUPUI Women’s Philanthropy Institute.
They see giving as something to do right now
Women’s fund and foundation donors don’t wait until retirement to start giving: only 36% are retired compared with 55% of general donors. Women’s fund and foundation donors also are more likely to have a budget for giving, have a charitable provision in their wills and to give appreciated stocks.
They give for different reasons
Donors who focus on women’s funds and foundations are inspired to give because they believe their dollars can make a difference. Only 11% say they give for tax reasons compared with 23% of general donors.
They do more than give money
Besides supporting women’s funds and foundations monetarily, these donors like to serve in ways that maximize their giving efforts – for example, by joining a nonprofit board of directors or talking to other donors. Women’s fund and foundation donors connect philanthropic leadership with deep engagement with organizations, leading in the local community, and owning the responsibility to effect positive change.
They know their stuff
The majority of women’s fund and foundation donors have been supporting these organizations for at least a decade and are committed to supporting them at the same or higher level in the future.
By the numbers
- 86% of households’ consumer purchasing decisions are made by women.
- 43% of the nation’s top wealth holders are women.
- Women and LGBTQ high-net-worth donors donate to women and girls’ causes at a higher rate (25%) than other high-net worth households.
- Women are fueling giving circles, a charitable collective that allows people to pool resources for a bigger charitable impact. In 2016, 70% of all giving circle participants were women.
The future of female philanthropy
As women continue to control more and more wealth, it is changing the way giving looks. Giving will become more focused on lifting up girls and other women, for example, according to the Women’s Philanthropy Institute. Female philanthropists recognize that the cause of women and girls is underfunded. In 2007, the Women Moving Millions initiative set out to begin solving for this. In this group of 320 women, each has committed to donating at least $1 million to organizations benefiting women and girls. So far, they’ve given more than $680 million in 15 countries. And in just 12 short years it has inspired more than 300 members to pledge more than $600 million to causes that commit to advancing women and girls around the world. Another group of female philanthropists set up the TIME’S UP Legal Defense Fund in January 2018 and has already raised close to $22 million online – showing that women are committed to supporting one another.
Giving will be integrated with investing instead of separate from it. In a recent survey, 84% of women said they were interested in sustainable investing. Also called impact investing, it couples financial goals with social or environmental causes. If you haven’t explored this yet, ask your financial advisor for more details.
- Talk to your family about making giving a tradition while you’re alive. It’s a way to ensure you get to see your good works in action.
- Talk to your advisor about ways to maximize your own philanthropic impact. Together, you can also discuss how to establish a giving plan or strategy.
Utilizing a sustainable investment strategy may result in investment returns that may be lower or higher than if decisions were based solely on investment considerations.
Sources: “All in for Women and Girls,” IUPUI Women’s Philanthropy Institute; “How Women’s Fund and Foundation Donors are Leading Through Philanthropy,” IUPUI Women’s Philanthropy Institute