In the eighth episode, titled “Giving in 2022,” our fearless leader, Lawson Bader, talks with Giving Ventures podcast host and DonorsTrust Vice President Peter Lipsett about the things donors and nonprofit development teams should know to finish the giving season strong. He wraps up our final podcast episode of the year giving an overview of the philanthropic landscape; trends we’re seeing now; and what to expect in 2022.
Show Me the Money
One of the biggest advantages of a donor-advised fund is that givers are able to defer their charitable decisions. They’re able to contribute money to their charitable investment account, take their tax benefit and then research and think about which charities they want their money to go to. Donors don’t, however, have to have their entire charitable strategy mapped out before opening an account or making an end-of-year contribution. In fact, initiate the transaction and we will sort out the details.
As Lawson says, “What we always like to tell people is, ‘Look, the information’s important but what really is more important is the gift and the gift getting to us, especially if it’s appreciated stock or closely held stock or mutual funds, where you can’t completely control that process. You need to get those things to us. And, what we like to tell people is, ‘Get ’em to us before December 31 and we’ll backfill all the personal information after New Years when things are much more calm.'”
Opening charitable-investment accounts and making contributions to those accounts in a timely manner is critical. Likewise, deciding which charities receive those funds and when they receive those funds is also critical. Nonprofits at the end of the year are trying to square their budgets and are in need of donations. Sometimes, though, philanthropists are so intentional with their giving that they lose sight of their larger philanthropic goals and can’t decide which deserving charities to give to.
“I think, at the end of the day, [donors] really should take their time but not procrastinate. So, be intentional without necessarily rushing. And I think, for so many people, that they let the perfect be the enemy of the good,” says Lawson, adding he marvels at donors that make serious multi-million-dollar business decisions every day but often struggle to designate $10,000 to a specific charity. “So, reflect a bit but then do,” says Lawson. “Be committed. Stop putzing.”
Philanthropy in 2022
Charitable giving will likely remain strong in 2022, says Lawson. The things that could change, however, are the laws and institutions that govern charitable giving. The relationship between private foundations and donor-advised-fund providers could shift, he says, either through “direct regulation” or “potential legislation.”
Moreover, as philanthropy becomes more partisan, the amount of resources used to identify who gives to what causes will likely increase in the months and years ahead. “This increasing politicization of giving is happening. I think it’s, frankly, going to be a little worse this next year because, as is no secret, we’re entering a midterm election season and that’s going to be a national conversation and this is going to affect the donor privacy piece.”
What’s particularly concerning, however, is how the groundswell of big-dollar philanthropy will impact up-and-coming philanthropists. Will the gargantuan donations of the ultra wealthy make small-dollar giving irrelevant or discourage more modest givers from dipping into their (much) smaller wallets?
“We push donor-advised funds in general because they really are for anybody. They’re not just for trillionaire, millionaire, billionaires. It’s for anybody, and I’m encouraged by the growth of donor-advised funds across the entire industry these last many years; that does gives me hope for the average donor but, when you start to see those commas, I do wonder how it’s going to affect the younger givers and those perhaps without the means. And we’ll just see how that changes the entire landscape.”
“The COVID Shift”
Philanthropists have pivoted their giving slightly, shifting somewhat from donating to public-policy organizations and instead giving more money to schools, hospitals and places of worship. “I don’t see any of that changing,” says Lawson. More money is clearly going toward more main-street nonprofits—local and state groups working on similar issues but at a more granular level. The one downward trend of note, says Lawson, is that there is less money going toward art and cultural centers.
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We hope this episode will help you think through potential philanthropic partnerships. It’s our hope this episode also gives insight into ways your giving is creating opportunities for everyone. Subscribe wherever you get your podcasts, and visit us at www.donorstrust.org/podcast to stream the show.