Posted June 1st, 2005

The Power of the Purse

There are many myths about women’s philanthropy: Women give less than men. Women give only to causes supported by their husbands. Male advisors make all the decisions. Women don’t understand money or want to discuss it. Women are willing to give time but not money. Women are only interested in special events. Women do not like to ask for money.

If you have thought any of the above about women, you are very much mistaken.

  • Women don’t give less than men, although they may give to fewer charities. Studies have shown that mature donors (age 50+) give to more than ten charities on average. Baby Boomer men tend to give to six to ten charities, while Boomer women give to fewer than five.

Although they may not give to as many charities as men, women have control over much of America’s wealth. According to the latest IRS figures, women make up 39% of the country’s 6.5 million top wealth holders, defined as adults with total assets of $625,000 or more. In fact, roughly 2.5 million women hold combined assets of $4.2 trillion. Looking at the bigger picture, women control over 50% of the total wealth in America.

  • Women don’t always give to the same charities as their husbands. Women often outlive their husbands, and thanks to the unlimited marital deduction, women are also often the recipients of their husband’s entire estate. Once they are the sole decision makers, women often give to charities based on their values rather than those of their husbands. Women like being hands-on with their philanthropy. If an organization’s mission isn’t personally interesting to them, they won’t give big gifts. Many women do continue to have a loyalty to their husband’s charitable interests, but only if the nonprofit has cultivated a relationship with the wife at the same level as that with the husband.
  • Many women participate in giving clubs and are no longer relying solely on male advisors. In the past, many women were relatively untutored in financial matters. Now, the ranks of the Boomers and subsequent generations are filled with female entrepreneurs who feel every bit as comfortable with their finances as men do. According to a report in April 2000 from the National Foundation for Women Business Owners, there are over nine million women owned firms in America. A survey of 400 of these high net-worth women revealed that over half contribute in excess of $25,000 a year to charities, including 19% who contribute $100,000 or more. Clearly, these savvy women understand business and are philanthropically inclined. In fact, the Women’s Funding Network, devoted to funds managed by and for women, currently has over 100 member funds, up from only 11 in the 1970s.
  • Women have become increasingly comfortable handling money, investing, and managing funds. More and more banks and investment companies have established programs marketed directly to women. In fact, there are over four million references to women’s investing on the Internet today. Women account for 48% of mutual fund holders and 60% of socially conscious investors. The Council on Foundations reports that 52% of foundations are now managed by women.
  • Women give time and money and money. Studies have shown that women are typically more likely to volunteer their time than men, and volunteers often make larger gifts than non-volunteers—on average, two and a half times more. The Philanthropy Among Business Women of Achievement report from the National Foundation for Women Business Owners Survey in 1999 reports that other factors that cause women to give to nonprofits include a passion for the organization’s issue, knowledge that the organization is well-run, an emotional connection with the charity, and, most importantly, a well-informed understanding of the charity’s programs and needs. All of these components can be enhanced by an effective volunteer program that includes women.
  • Some women are interested in special events, but most women support causes they care about by opening their purses, not just their Palm Pilots. S.C. Shaw and M.A. Taylor reveal in their book Reinventing Fundraising: Realizing the Potential of Women’s Philanthropy (Jossey-Bass Publishers, 1995) that women want to:

–Create by helping to fund initiatives that serve society beyond the lifetime of the donor.

–Change by targeting a program and seeing an effect rather than giving unrestricted gifts.

–Connect on a personal level with the charity. They want to know how the project is going and how their gift is used.

–Collaborate by being part of a bigger effort (giving circles and focused funds).

–Commit by volunteering—the tradition of service continues.

–Celebrate by recognizing that philanthropy is fun (the special events arena).

  • Many women are expert solicitors. In fact, 62% of the membership of the Association of Fundraising Professionals is female. Some say women are better solicitors because they are more empathetic listeners. Women tend to work collaboratively and may be more inclusive in decision making. Those qualities in turn may help planned gift donors feel as though they are a part of the process of deciding how to make their gift of a lifetime.

Women are smart about money: They are willing to seek help if they need it, hence the books, giving and investment clubs, and special banking services for women only. They tend to avoid risk, and are more likely than men to make gifts in the form of bequests, charitable gift annuities, pooled income funds, and charitable remainder annuity trusts. They do their homework, want details, and take time to check with their advisors and colleagues. They set goals.

Women are smart about philanthropy too. To do a better job reaching potential female planned gift donors, carefully research your files (look for all those with Miss, Ms., or Mrs. in the salutation field). Don’t lose the names of widows, and be sure you include spouses in donor cultivation efforts. If possible, educate women in seminars and other gatherings aimed at their needs. Focus on issues important to women, such as how their gifts have an impact on the lives of students, or the latest medical research. Encourage giving with appropriate recognition, as most women love being part of a bigger, successful organization. And last but by no means least, make sure to thank women for their gifts and recognize them for longevity and cumulative giving in addition to the amount of their most recent gift. This can be vital in efforts to continue gifts from widows after the death of their husbands.

As women continue on their way to becoming more committed philanthropists, we may want to change the old saying “Behind every successful man is a woman” to “Behind every successful charity are many wonderful women.”

The publisher of Give & Take is not engaged in rendering legal or tax advisory service. For advice and assistance in specific cases, the services of your own counsel should be obtained. Articles in Give & Take may generally be reprinted for distribution to board members and staff of nonprofit institutions and other non-donor groups. Proper credit must be given. Call for details.

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