Bank of America released an initial report in a study of giving by high net worth individuals, with research provided by the Center on Philanthropy at Indiana University. It reports some very curious findings, for instance:
- monetary giving for religious causes drops sharply among households that volunteer more than one hundred hours a year.
- households with three children contribute about four times as much to religious causes than households with four children, but only give half as much to secular causes.
So without some explanation for these peculiar findings, I'm not giving this report much credence.
However, one chart showing the amount of giving by total net worth piqued my interest (it's the one at the top of this article; click to open it in a new window). As often happens with these charts, the top category looks a lot different than the rest. The very, very rich give many times more than the merely rich. And this top category is open ended, ranging from a paltry $50 million nest egg all the way up to Bill Gates' approximatly $50 billion fortune (shared, of course, with his wife Melinda), a thousand times larger.
Even more serious, missing from the chart and the report are some indication of how many individuals fall into each category, and what is the aggregate wealth they represent. I tried to rectify that by linking some wealth data from the IRS ("Personal Wealth 2001" a MS Excel file) with an analysis of the Forbes Magazine 400 Wealthiest Americans to come up with a guess of the complete wealth pyramid in the US.
My guess is that the bulk of the aggregate wealth is with the less wealthy wealthy, simply because they are relatively numerous. The four hundreded top rich people account for about 9% of the $11.5 trillion wealth of the wealthiest, while the two and a half million mere millionaires claim about 30%.
But that doesn't mean that all this is money that could go for charity. For the less wealthy, it may just reflect the retirement savings of high achievers, which will be spent down, not given away, to maintain their high-income lifestyle after they stop working. It could well be that only a relative few of those wealthy on paper will have large amounts of discretionary wealth. That's why the suspicion is dawning that there may not be a huge wealth transfer in the offing ("Slight Miscalculation: Trillions in Wealth Transfer a No Show So Far," April 19, 2006). A million dollar fortune ain't what it used to be.