With $41 trillion expected to pass by inheritance to NextGen heirs in the coming decades, people are asking, “What’s going to happen to that wealth?” and “Will young people be as philanthropic as their elders?” The answer appears to be that young people are committed to philanthropy and will indeed quickly carry the torch and contribute generously to helping solve the problems facing our communities and our world.
The term NextGen commonly refers to two groups of young people: those born between 1964 and 1980 (“Gen X”) and those born between 1981 and 1999 (“Gen Y”), totaling 122 million people, or nearly 40 percent of the U.S. population.
In the first study of its kind released last month by the Dorothy A. Johnson Center for Philanthropy and 21/64, called #NextGenDonors: Respecting Legacy, Revolutionizing Philanthropy, researchers found many young people, “mostly inheritors and some earners, who are serious and responsible, who work hard to educate and prepare themselves because they know they are poised to become the most philanthropic donors in history.”
The study surveyed more than 300 NextGen donors and reached four principal conclusions:
- Driven by Values — Personal values, often learned from parents and grandparents, drive NextGen donors to use new philanthropic tools to make a difference.
- Impact Comes First — Employing strategic approaches to solving problems with philanthropy, NextGen donors care more about the impact of their philanthropic investments than the recognition they receive for giving.
- Seeking Hands-On Engagement — NextGen donors want to do more than write a check; they want to also contribute their time, talent and networks in developing close relationships with the nonprofits they support.
- Crafting Philanthropic Identities Now — NextGen donors won’t wait until late in life to craft their own identities as donors; they’re doing it at the earliest opportunity.
The study reports that although NextGen donors share some philanthropic priorities with their families, they also diverge on their giving interests. NextGen donors tend to share their elders’ focus on youths and families, basic needs and education but have less interest in supporting health, religion and the arts, and have a greater interest in supporting animal welfare, the environment, civil rights and advocacy. For more see grantcraft.org.
Sabrina Merage, 27, directs her own foundation and observes, “Our parents’ generation tended to give general grants to larger institutions that would then distribute the funds based on community needs. Many younger philanthropists seek involvement on a deeper level with smaller organizations where we can actually see a tangible impact.”
Katherine Lorenz, 34, president of the Cynthia and George Mitchell Foundation, says, “Our foundation is driven by values passed down from our parents and grandparents. While they focused on building large and reputable institutions, we focus more on a grassroots approach, developing a portfolio of grants to address an issue from several angles rather than trusting that one institution alone will be able to move the needle.”
For younger people wanting to learn more, there are many organizations working to support young philanthropists. 21/64 offers great tools and information; Emerging Practitioners in Philanthropy seeks to strengthen the next generation of grant makers; Generation Waking Up engages young people to create a thriving, just and sustainable world; and <a href="http://www web based project management.resourcegeneration.org/”>Resource Generation organizes younger people with wealth to leverage resources for social change.
The amount of wealth soon to be transferred between generations is staggering. So are the problems facing the world. All indications are that young philanthropists are harnessing their passion, talents and values to take philanthropy to the next level of impact, and they’re doing it now.
Nonprofit of the Month
Colorado Youth for a Change began in 2005 to help solve Colorado’s serious dropout crisis. Working with school districts to create outreach and recovery programs, dropout-intervention initiatives and offerings tailored to out-of-school youths, CYC helped achieve a 32 percent reduction in dropouts statewide. Its programs capture millions of dollars in retained or recovered per pupil operating revenue for public schools, and impact the educational paths of thousands of students.
Bruce DeBoskey is a Colorado-based philanthropic adviser, helping families, businesses and foundations with their philanthropic initiatives.