One of the first people to call to congratulate you is a guy from college you haven’t seen since graduation. He says that he and somebody named Tom Hamilton will be in town next week. Can they buy you lunch? You hang up the phone and Google “Tom Hamilton” to discover that he is (gulp) assistant director of major gifts at the university.
What did you expect?
The Sort of Rich, the affluent people your grandmother might have called “well to do,” have been rediscovered by the growing ranks of professional fund-raisers.
It may be hard to imagine millionaires as the People Fund-Raisers Forgot, but that’s exactly what happened: during the dizzy dot-com days of the ’90s and later, professional fund-raisers tended to concentrate on the easy pickings of the superrich.
But it’s belt tightening time again, and low-end millionaires are back in vogue.
And at lunch you won’t be hit up for a $100 check. In fact, you may gasp at how much you will be asked to donate. Colleges, hospitals and myriad other charities are applying ways to measure their own effectiveness, including staff-time-to-donation ratios. Development offices now have quarterly gift goals. They are working on the Big Ask.
While plenty of schools teach fund-raising, there are no advanced degrees in how to be a philanthropist, turn down a request or shrink the amount of a gift that is being sought.
There is a way to avoid awkward situations like that lunch with your old college chum and the fund-raising pro. It’s called pre-emptive philanthropy. By practicing it you will probably feel happier about the gifts you do make, and you will give in ways that have more impact.
Those lucky enough to earn $200,000 or more a year and have a net worth of at least $1 million represent only 4 percent of American households but account for 60 percent of giving, according to a study by the Bank of America and the Center on Philanthropy at Indiana University.
Yet the study also found that slightly more than half of wealthy donors said they were “dissatisfied” or only “somewhat satisfied” with their giving. Mostly that is because they are responding to requests rather than taking charge of their own giving.
The trick is to give without being asked. If you have a child playing in the American Youth Soccer Organization, don’t just make out a $100 check to the cause. Find out how much it costs to buy team uniforms or trophies for the league and give that amount.
The people I know who give the most and get the most out of it go deep. They pick a few causes and tithe not just their treasure but also their time and talent. They identify strongly with these causes, carry brochures, spend time on-site and when called upon they may even lick stamps and stuff envelopes.
If you own a restaurant or a jewelry store, you know you’re going to be asked to give auction items for charity, so have fun with it. Don’t wait to be asked by charities you hardly know or do not care about. Put up signs asking your customers to help you select 10 lucky nonprofits to get auction items this year, and make the items significant, both to the charity and to you. Now you have chosen which causes to support this year. Next year you can stick with them or support others, but you choose them, not the other way around.
When pre-emptive philanthropists don’t find the projects they want to finance, they often start their own, either through nonprofit incubators like Community Partners in Southern California; the Tides Foundation, which promotes social change; the Fund for the City of New York; or by setting up a family fund at one of the hundreds of community foundations across the country.
A community foundation fund can also allow low-end millionaires who may not be able to afford their own staff to share support workers who will not only handle tax, investment and monitoring services, but who also understand the charitable sector and can offer advice on the cost of providing charitable services.
One of the best reasons to become a pre-emptive philanthropist is to make sure you develop relationships with causes you care about most. Charities may see the emerging wealthy as people who, if cultivated, may become big donors as your fortunes grow. That can be true, but you will be happier and give more if you take the initiative to cultivate the causes you care about.
Your alma mater may be that cause. But if it isn’t, feel free to pick up the lunch tab with a comfortable grin and thank Tom Hamilton for the pleasure of catching up on college matters. You can say you’ve invested your charitable capital in other priorities but are flattered they took the time to ask.
Giving is an important route to writing what Paul G. Schervish, who heads the Center on Wealth and Philanthropy at Boston College, calls your “moral biography.” By getting deeply involved in a few projects, both financially and personally, by being creative and helpful without being asked, by becoming a pre-emptive philanthropist, you can discover how writing that moral biography can be hugely satisfying, even fun.
Jack Shakely is president emeritus of the California Community Foundation in Los Angeles.
Copyright 2008 The New York Times Company. Reprinted with permission. Illustration credit: Andy Rash.