Why Younger Donors Stop Giving

Charitable giving helps finance causes and needs you believe in, provides personal satisfaction, and offers potential tax advantages. So why has giving among younger individuals stagnated or declined over the past five years?

Money Is a Factor

The high and rising costs of necessities like housing, health care, and food are taking a bigger bite out of younger people's budgets. The three younger generations carry a high student loan debt load. And the youngest faces a dearth of well-paying entry-level jobs. These factors all mean they have less money left over to give away than older generations may have had when they were younger and do now.

A Different Viewpoint

But that doesn't mean Gen Xers, Millennials, and Gen Zers are being less generous than older cohorts when they decrease or even stop monetary donations. Many are activists who want to see what dollars they do donate go further. If they don't see their donations making a difference, those donations may dwindle. Instead of just giving money, they'll give their support by spreading the word on social media, starting a peer-to-peer mutual aid group, volunteering, crowdfunding, or serving on a nonprofit's board of directors.

Lack of communication may cause some younger donors to decrease or halt contributions. While all donors appreciate regular contact from organizations they support, younger donors have a greater desire for frequent email and text communication. Surprisingly, nearly three-quarters of Gen Z donors would welcome physical mailings from the organizations they support.

Staying Engaged with a Donor-Advised Fund (DAF)

For younger high-net-worth individuals, the accessibility and flexibility of donor-advised funds make them an attractive option. A donor-advised fund is a charitable giving vehicle that allows individuals to contribute assets to an account, receive an immediate tax deduction, and then enjoy the flexibility to distribute those funds to selected charities over time. This structure offers a unique blend of control, convenience, and tax benefits, catering to the goals and financial strategies of younger philanthropists. Instead of feeling rushed to distribute large sums of money immediately after contributing, donors can take their time to identify causes that resonate with them, learn about different nonprofits, and thoroughly research organizations.

Source: The Donor Participation Report, Wise Giving Alliance at Give.org