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The Forgotten Story of Christmas: Entrepreneurship Propels Charity

As the US Economy increases by the efforts of entrepreneurs growing their businesses, so does charitable donations. Unfortunately, as government grows, especially the Federal Government, there is a decrease in the aggregate dollars given to charity. Below are a variety of “Charitable Giving Statistics” and a graph that convey this truth:

Individual and Family Philanthropy

* 95.4% of households give to charity. 1
* The average annual household contribution is $2,974. 1
* Americans gave $335.17 billion in 2013. This reflects a 4.4% increase from 2011. 2
* Corporate giving held steady in 2013 at $16.76 billion. 2
* Foundation giving increased in 2013 to $50.28 billion–a 5.7% increase from 2011. 4
* In 2013, the largest source of charitable giving came from individuals at $241.32 billion, or 72% of total giving; followed by foundations ($50.28 billion/15%), bequests ($26.81 billion/8%), and corporations ($16.76 billion/5%). 2
* In 2013, the majority of charitable dollars went to religion (31%), education (16%), human services (12%), and grantmaking foundations (11%). 2
* Education experienced the largest giving increase in 2013, receiving 8.9% more than the previous year. 2
* Charitable giving accounted for 2% of gross domestic product in 2013. 2
* Historically, charitable giving rises about one-third as fast as the stock market. 3
* It is estimated that between $6.6 trillion and $27.4 trillion in charitable bequests will be made between 1998-2052. 5
* It is estimated total charitable contributions will total between $21.2 to $55.4 trillion in between 1998-2052. 5
* By the year 2055, some $41 trillion will change hands as Americans pass on their accumulated assets to the next generation. 5
* 95% of high net worth households give to charity. 6
* 62% of high net worth donors cite “giving back to the community” as a chief motivation for giving. 6
* Last year, the greatest percentage of high net worth households gave to educational (80 percent) and basic needs (79 percent) organizations, followed by 69% to the arts, 65% to health related organizations, and 65% to religious organizations. 6
* In 2013, 100 of the largest charities reported receiving 13% more in online donations, and 25 of these charities collected more than $10 million each in 2013 from online gifts. 7

Giving-USA-2014-chart

Charitable Organizations: The Tax-Exempt Sector

* In 2013, there were approximately 1,536,084 charitable organizations in the United States. 9
* There are an estimated 321,839 congregations in the United States in July 2014. 9
* In 2012, public charities reported over $1.65 trillion in total revenues, $1.57 trillion in total expenses, and over $3 trillion in total assets. 9
* 62% of tax-exempt organizations that filed a tax return in 2009 had assets under $100,000 with cumulative revenue of $32.3 billion. 9
* Tax-exempt organizations with assets over $100 million make up 0.4% of the sector and reported revenue of $1.1 trillion in 2009. 9
* Sources of revenue for tax-exempt organizations in 2012 were program service revenues, including government contracts and fees (73%), contributions, gifts, & government grants (21%) and lastly, dues, special event income, rental income and net sales from goods (6%). 9
* There were 86,192 foundations in the United States in 2012, a 5.3% increase from 2011. 3
* In 2010, nonprofits accounted for 9.2% of all wages and salaries paid in the United States. 9

Charity

Online Giving

* In 2013, Online giving grew by 13.5%, while overall charitable giving grew by 4.9%. 17
* Of all charitable giving in 2013, online giving accounted for 6.4%. 17
* Small nonprofits grew their online giving the most. 17
* Faith-based nonprofits had the biggest increase in online giving. 17

Volunteering (Individuals)

* 64.5 million adults volunteered 7.9 billion hours of service, worth an estimated value of $175 billion. 11
* The estimated dollar value of volunteer time is $22.55 per hour for 2013. 12
* The top four national volunteer activities are fundraising or selling items to raise money (25.7%), food collection or distribution (23.8%), general labor or transportation (19.8%), and tutoring or teaching (17.9%). 13
*The top four volunteer areas are for religious (34.2%), educational (26.5%), social service (14.4%), and health (8.0%) organizations. 13

Donor-Advised Funds

* There were 201,631 donor-advised fund accounts in 2012. 14
* Donor-advised funds held $45.35 billion in assets in 2012. 14
* Annual contributions into donor-advised funds were $13.71 billion in 2012. 14
* Donors recommended grants from donor-advised funds totaling $8.62 billion to charities in 2012. 14
* Average donor-advised fund account size was $224,921 in 2012. 14

Supporting Organizations

* There are more than 57,000 Supporting Organizations operating in the United States. 15
* Supporting organizations have combined total assets of $76-billion. 16

Other Charitable Giving Vehicles

* There were 91,244 Charitable Remainder Unitrusts with total assets of $85.2 billion in 2012. 16
* There were 14,616 Charitable Remainder Annuity Trusts with total assets of $6.4 billion in 2012. 16
* There were 6,498 Charitable Lead Trusts with total assets of $23.7 billion in 2012. 16
* There were 1,324 Pooled Income Funds with total assets of $1.25 billion in 2012. 16

———–
Sources
1. The Center on Philanthropy at Indiana University
2. Giving USA 2012
3. The Foundation Center
4. Center on Wealth and Philanthropy
5. The 2010 Bank of America Study of High Net Worth Philanthropy conducted by the Center on Philanthropy at Indiana University
6. The 2012 Bank of America Study of High Net Worth Philanthropy conducted by the Center on Philanthropy at Indiana University
7. The Chronicle of Philanthropy
8. Congressional Research Service
9. The Urban Institute, National Center for Charitable Statistics
10. Bureau of Labor Statistics
11. Independent Sector
12. The Urban Institute
13. The Corporation for National and Community Service
14. National Philanthropic Trust – Donor Advised Fund Market Report 2013
15. The Urban Institute, National Center for Charitable Statistics, US Non Profit Sector
16. Internal Revenue Service – Statistics of Income Tax Statistics: Split-Interest Tax Statistics
17. The Charitable Giving Report, derived from The Blackbaud Index
———–

Although the 2013 American Charitable Giving Total of $335.17 billion may be impressive, it amounts to about one-fifth the amount 40 years ago after adjusting for inflation. If charitable donations usually increase at about one-third the rate of Wall Street, why is recent American Charitable Giving only one-fifth what it used to be 40 years ago? I think the answer is that the massive growth of the Federal Government from the 1970s until now has caused many to rely more on the Public Sector rather than the Private Sector to help the needy. I think this is very unfortunate because there’s a growing consensus that the Private Sector does a much better and more efficient job in helping those in need. Hopefully, in the near future, we can reverse the growth of government and, thus, unleashing the Private Sector to provide more help to those in need at prices we can all better afford.

I pray that you and yours have a very Merry Christmas and Happy New Year!

Cheers,
Erdley Wright,
Founder and CEO, WrightBusinessIT.com
Board Treasurer, Urban Youth Alliance International

About WrightBusinessIT.com:
My passion for technology grew as I served as a Network and Systems Administrator in the US Marine Corps. I founded WrightBusinessIT.com in order to continue serving my nation by delivering excellent Information Technology (IT) Services and Support to our clients. WrightBusinessIT.com provides IT Services to clients in a variety of industries including aerospace, aviation, asset tracking, education, financial services, government, healthcare, interior design, luxury goods, nonprofit, manufacturing, retail, social services, utilities, etc.

We take Donating, Giving Back, and Social Responsibility seriously at WrightBusinessIT.com. To this end, we strongly support Per Scholas, which was founded more than 20 years ago to break the cycle of poverty by providing technology access and education in underserved communities.

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About the Author

CEO & Founder, Wright Consulting IT Services | WrightBusinessIT.com | @NYC_Business_IT | #WrightBusinessIT

6 Enlightened Replies

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  1. Doug Parsons says:

    Although it’s known you can never seem to have enough money, the famous rejoinder from Rockefeller when asked how much money do you need was “Just a little bit more.”

    However, that’s not an absolute. A curious development during the 80’s, the so-called “Greedy 80’s” during those halcyon Reagan years was with the high-tech explosion, lots of people were making money hand-over-fist. But once they got their BMW and their McMansion and other things, they weren’t immediately after more and better cars, or houses etc. They had a sense they had enough, more than enough, and that others weren’t as fortunate as they: the charitable giving went right through the roof.

    Government wants to be the only vehicle of largess. It was an interesting rejoinder from the Left when Romney’s tax forms were finally released and it showed, in addition to the tax deductions he DIDN’T take, that is, demonstrating the Romney’s were more than willing to toss into the public coffers for the common good, was the huge amount given to charities of all sorts. The Left’s rejoinder was a slam against him: “There! You See!? He could afford to pay more taxes!! (We should decided where his charitable monies should go …)”

    Smaller charities offer less temptation to convert from “Doing good, to doing well.” (The phrase, if unfamiliar, touches on the phenomena of how often people and organizations start out wanting, and succeeding, in doing good, but the draw of lucre corrupts them bit by bit and they end up doing well and doing good falls by the way-side.)

    Anyhow, smaller charities also keeps the charity involved with its clientele, they always remain people with people concerns and issues, and never into numbers and bottom lines. However, this means many different people & groups doing many different “good” to many different kinds and classes of people–each always remains an individual. The government (state more than local, federal more than state), tends to collectivism so they have more control, or have fewer to control. They hate Vox Poli.

    Great post, Erdley!
    Nice easy to read statistics so we now the substantiation without getting lost in the weeds.
    Great encouragement to the rest of us to do better, to do more.
    Falls right in line with all your other involvements outside of your business. Weary not in well-doing, my friend.
    Looking forward to reading the other replies to your blog.

  2. Jessica says:

    Wow! Those are encouraging statistics on charitable giving!!! Love this! I’m going to share your blog with my boyfriend. We were just talking about charity work and our volunteering goals last night! Thanks for sharing!! I’ll read through other posts soon.

  3. Christopher Renfro says:

    I believe the message that came across was very important and is right! Most of the giving and help should revert back to its roots of the days of the village! Everyone helped everyone but in true fashion over time as greed and the need for position and power became more of a priority for some, the village became less of a concern! It is reflected in our current society as well the history of civilization that when the system of government grew, more people who fell short in some ways were left to pick up the pieces on their own and thus relying more on public assistance. I honestly believe that the heart of a nation and strength can come from the work of a team, the entire team doing a little at a time which makes a big impact! In other words, I agree so much with your message brother but it goes so much deeper and so far back that unless we change our minds as a society, we will not see those numbers increase too long! My sincere prayer is that they do and not just only in religious organizations but in philanthropic causes too! Great article! So proud of you my brother!

  4. Doug Parsons says:

    Hi Chris, I think your belief in pessimism belies the facts.

    “but in true fashion over time as greed and the need for position and power became more of a priority for some”
    This has ALWAYS been the case, some do, some do not. The whole “A Christmas Carol” story was about greed, position, power becoming a priority for some. And the point of the story, they all can be redeemed, and should — don’t give up the ghost!! This is Erdley’s point.

    I’m not sure what you suggest as the solution, except in the vaguest of terms.
    I think Erdley is saying, to which I agree, it starts with me, I must bloom where I’m planted.
    It’s always been the few. The rest follow. We don’t want too many leaders, so if the Salvation Army has a plan and is executing a Soup Kitchen, you and I can just show up and do the work, and perhaps get the vision and do more, but just showing up and doing the work is good. I took my youth group, decades ago, to run the soup kitchen several times, we worked according to the rule and procedures of those in charge, many have since gone on with their lives, but some are in full time ministry.

    “we will not see those numbers increase too long! ”
    But that’s exactly the point, this number increase, this has been going on for some time, with set-backs, of course. You and I need to start doing our part, what we find to do, and encourage those in our spheres more by our example than by our words. The rest of society can do whatever it does, we needn’t mope about what others are or are not doing.

    I follow one of Erdley’s motto:
    The modern recruiting slogan is “the few, the proud, the Marines.”

  5. thank you for posting this article as I found it valuable – do you know where to find the best forgotten story of Christmas as an entrepreneur?

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