Financial Planning.com: When planners help clients manage their wealth, it is important to help them recognize the deep emotional sources of philanthropy. Hundreds of interviews over the years with philanthropists have led me to the notion of empathy and identifying with others as the key motives behind giving. Ask donors about an important gift and you will hear that the people they help are like themselves, their children, parents or other loved ones. We care for others as extensions of ourselves.
A day usually comes in your clients’ lives when acquiring more wealth ceases to be so important. They then face the question of how to live next and impart to their children a moral biography. Most will want to give because giving is a natural source of happiness.
People always tell us they “want to give back.” They speak about how they were helped in life and often remember teachers and others who formed them. We have all received gifts. People who give back recognize twists in their life stories as grace or luck. They notice unmerited, unearned and unpredictable interventions in their life.
The wealthy often worry about how a large inheritance will affect their kids. Our research found they’re giving larger percentages to charity, often through a family foundation or involving heirs in philanthropy. Some want to keep businesses or real estate in the family, but more of the wealthy feel the best use of their money is to give less to their kids and more to people who can benefit.
We all seek to shape the world, even if only our small part. We want to make a difference. We see ourselves as agents – thinking, feeling and acting in ways that move ourselves and our world from one situation to the next. The wealthy can make history, establishing or altering the conditions under which others work and live. I see the very wealthy as “hyper-agents” who can achieve changes that would otherwise require a social or political movement. Less wealthy people magnify their actions by forming giving circles or organizing big groups for charity.
Continue reading why people give to charity.