What does the charitable giving of higher net worth households teach us about generosity? That might seem an obvious question. Nine out of 10 high net worth households give charitably, and they give much more on an annual basis than the general U.S. population. The clear conclusion is that those who have more, give more.

But I wonder if we get a truer picture by looking at giving as a percentage of net worth or as a percentage of income.

Take a look at the chart below from New York University economics professor Edward Wolff, who wrote an extensive National Bureau of Economic Research working paper on middle class wealth in the U.S. from 1962 to 2016. Looking at the chart, you’ll see that the U.S. mean (average) net worth has risen dramatically since 1962—more than three times higher!

If that average net worth of $667,000 seems high, it is! It’s because of the ultra-high net worth of a small percentage of Americans. That total gets spread out over the total number of U.S. households and inflates the average net worth number.

(In contrast, the median net worth of U.S. households was $78,100 in 2016, so half of U.S. households had a higher net worth than $78K, and half had a lower net worth. That’s a better picture of the population as a whole.)

Back to the original question: does charitable giving increase as net worth rises? According to the 2018 U.S. Trust Study of High Net Worth Philanthropy, 90 percent of U.S. high net worth households gave to charity in 2017, which compares favorably to the 56 percent of the general population who gave. High net worth households also give significantly more per year than general U.S. households—11.6 times more in 2017 (see the chart).

But here’s a bit more context. While the average annual gift in 2017 was $29,269, the average net worth of the survey respondents was $16.8 million, with the average annual income approximately $331,156. That puts the average amount given to charity into perspective!

Rising net worth, rising generosity?

So what’s our verdict? I want to be careful here. Any amount freely given to charitable causes and organizations is worth celebrating. But I can’t help but think of what C.S. Lewis wrote about giving in Mere Christianity.

“I do not believe one can settle how much we ought to give. I am afraid the only safe rule is to give more than we can spare. In other words, if our expenditure on comforts, luxuries, amusements, etc., is up to the standard common among those with the same income as our own, we are probably giving away too little. If our charities do not at all pinch or hamper us, I should say they are too small.”

For the vast majority of Americans, having more resources means spending more on ourselves.

I wonder if the measure of our generosity includes not just the size of the gift but also our capacity to give.

Why aren’t we more generous?

How surprising is it that we haven’t seen charitable giving increase much in the U.S. despite the dramatic rise in average net worth?

After all, generosity is a matter of the heart. A generous heart will play out in our relationships, our spending and our giving.

And where does a generous heart come from? I think it starts with gratitude. Those who believe they’ve been given much by God are inclined to give much in response. One who receives grace becomes one who gives grace.

When that’s our story, life becomes a joyful partnership with God in the opportunities he brings our way.

Photo by Alev Takil on Unsplash

Bill High

Bill is CEO & Founder of Vyne Legacy. He works with families to equip them with tools to build multigenerational legacies, and he teaches givers and financial advisers on transformational biblical generosity. He is the co-author with David Green of Giving It All Away and Getting It All Back Again: The Way of Living Generously.

Published October 16, 2019

Topics: Generosity | Giving Trends

Charitable GivingChristian PhilanthropyGenerosityHigh Net WorthWealth