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How the Aging Population Will Affect Giving

People are getting older.  Birth rates are declining.  Those are two really big statements that could easily be overlooked.  What’s the significance to charities?

Think about it.  In Japan and Europe alone, the working age population shrinks by 30 and 37 million people respectively.  Less workers means less productivity and less taxes collected.  These are domino effects.

Consider the United States.  The older (65+) population in 2030 is projected to be twice as large as in 2000.  This age group will grow from 35 million to 72 million.  This will represent nearly 20 percent of the total U.S. population.

While the older generation may have a higher net worth than the younger generations, they give more slowly.  And on a relative basis, their annual income is declining.  In short, they are holding on to their wealth.  Frankly, they tend to be spending on themselves and saving up for health care costs.

These are not bold predictions.  They are facts.  If there are fewer people being born, and if the population as a whole is older, then giving will go down.  It’s a pretty simple equation.  Put it in different terms.  Today, let’s say your ministry has a database of 10,000 names.  That database is vibrant, and giving regularly.  But imagine that in 15+ years, that you added relatively few donors, and 2,000 of your donors all went on Social Security.

Impact?  They would give less.  Charities need to prepare for the aging of their databases by building good relationships with their donors now.  Establish an endowment, but do it the simple and quick way through a donor advised fund through a Christian community foundation.  That way you’ll be ready to receive gifts right away.  The time is now, because in the future we get old…

About Bill High

Bill is CEO of the Signatry: A Global Christian Foundation. He works with families, individual givers, and financial advisers to share the foundation’s message regarding biblical generosity and charitable giving. » Learn More. He is the co-author with David Green of Giving It All Away and Getting It All Back Again: The Way of Living Generously.

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