November 9, 2010 / 2:47 PM / 7 years ago

Giving by rich Americans fell during recession: study

<p>A model reads a magazine during the summer contingent of the Millionaire Fair of luxury goods in Moscow, July 4, 2010. REUTERS/Sergei Karpukhin</p>

NEW YORK (Reuters) - Charitable giving by wealthy Americans dropped by more than a third between 2007 and 2009 as the worst U.S. recession in decades put pressure on the nonprofit sector, according to a study released on Tuesday.

While almost all rich Americans -- more than 98 percent -- donated to nonprofit groups last year, the average amount fell to $54,016 in 2009 from $83,034 in 2007 and $91,928 in 2005, the third biennial Bank of America Merrill Lynch study found.

“We obviously did see a decrease in the actual dollars given, that’s not surprising given the times,” Claire Costello, national foundation executive for Bank of America Merrill Lynch, told Reuters.

More than 800 people with a household income of more than $200,000 and/or net worth of at least $1 million -- excluding the value of their homes -- were surveyed by the Center on Philanthropy at Indiana University. The average wealth of the respondents was $10.7 million.

Total U.S. charitable giving fell 3.9 percent in 2009 to $303.7 billion, the Center on Philanthropy at Indiana University found in a separate study earlier this year.

<p>Four thousand U.S. dollars are counted out by a banker counting currency at a bank in Westminster, Colorado November 3, 2009. REUTERS/Rick Wilking</p>

While the longest U.S. recession since the Great Depression ended in June 2009, according to the National Bureau of Economic Research, the country’s economy has been struggling to recover, with unemployment stuck around 9.6 percent.

Two-thirds of wealthy families continued to support the same charities in 2009, found the Study of High Net World Philanthropy, and more than 94 percent have confidence in nonprofit groups to solve the world’s problems.

More than 43 percent of all wealthy donors gave less than $10,000 to charity in 2009, while 2.5 percent made donations of more than $500,000, the study found.

The top three causes supported by rich Americans were basic needs, education and the arts. The top three motivations were the wish to make a difference, feeling financially secure and wanting to give to a group that is efficient.

The study found a growing trend of wealthy donors expecting nonprofit organizations to be effective and transparent.

More than 78 percent of wealthy Americans also volunteered in 2009, up nearly 4 percent from 2007, volunteering an average of 307 hours.

Editing by Todd Eastham

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