As Americans file their 2015 tax returns, many charitable donors are not making use of strategies that could help them save and give more
BOSTON, April 12, 2016 – Most charitable donors surveyed in a new study conducted by Fidelity Charitable do not know about the range of available giving options, including writing a charity into a will, donating appreciated securities, or using a donor-advised fund. "Our research uncovered remarkably low awareness and use of the full range of tax-advantaged giving methods," said Matt Nash, senior vice president of donor engagement at Fidelity Charitable. "This giving gap may limit potential savings and prevent people from giving more to the deserving charities they support."
The survey asked affluent and high net-worth donors1 to indicate their familiarity with and use of nine different charitable giving methods,2 and explored how annual gift size, wealth, age, and advisor relationships affected awareness and use. Of those surveyed, 92 percent said that charitable giving is equally or more important to them than other financial priorities. Despite that common commitment to giving, about half said they donate financially to charity using only cash, checks, or credit card payments. Most did not know about the range of giving options available to them.
That lack of knowledge translates into low use. While nearly 80 percent of those surveyed owned appreciated assets, such as stocks, mutual funds or bonds, only 21 percent had ever contributed those assets to charity. While nearly 90 percent of donors had a retirement or life insurance plan, only 9 percent had named a charity as a beneficiary of the plan. Among the factors that influenced awareness and use levels:
“Frankly, we were surprised to uncover this awareness gap. Americans have a strong commitment to philanthropy, but those who give have varying understanding of the range of ways they can support their favorite causes,” said Brian Deacy, national fundraising manager for Fidelity Charitable. “While advisors are doing a good job discussing charitable planning, there is certainly ample opportunity for them to add value by helping educate their clients about the smartest ways to give.”
There is a broad range of charitable giving methods available to donors. Using specific giving methods may make planning easier. Others may help create tax savings, and some giving methods may enable donors to give more to the charities and causes they care about. Donors, nonprofits and advisors can benefit from the results of this survey, which show that:
Download The Giving Gap report.
1 Based on a survey of 950 donors who give to charity, conducted 2015-2016. The surveys were conducted by W5, an independent research firm. The percentages reported exclude donor responses of NA/Unsure. Questions about understanding of charitable giving vehicles, time spent on charitable giving, charitable budgeting, importance of charitable giving compared to other financial priorities, and ability to give in the future were all asked to half of the base sample.
2The nine methods offered in the survey were: bequests, or leaving money to charity in a will; donating appreciated assets, such as securities or real estate; family foundations or private foundations; donor-advised funds; naming a charity as the beneficiary of a retirement or life insurance plan; charitable trusts, such as a charitable lead trust or a charitable remainder trust; charitable gift annuity; community foundations; and making a qualified charitable distribution from an IRA.
Fidelity Charitable is an independent public charity that has helped donors support more than 219,000 nonprofit organizations with more than $21 billion in grants. Established in 1991, Fidelity Charitable launched the first national donor-advised fund program. The mission of the organization is to further the American tradition of philanthropy by providing programs that make charitable giving simple, effective, and accessible. For more information about Fidelity Charitable, visit https://www.fidelitycharitable.org.