Giving Circles Popular with Minorities

It’s long been known that giving circles are popular among women donors, but a recent study provides new information that such networks are also popular among minority donors, particularly African-Americans.

Giving circles, also known as community circles, are groups of people who combine their charitable contributions and decide together which charities will receive them. They are not affiliated with individual charities, as are legacy societies, and giving circles usually make current gifts rather than planned gifts, though some gifts are spread over a period of years. Giving circle participants tend to be good candidates for planned gifts, and the circles also provide networking opportunities for prospective donors of planned gifts. The circles have grown dramatically in recent years, to the point where one in eight American donors has been in one.

The study, titled “Connected to Give: Community Circles,” includes the following findings:

Percent of Donors Who Join Giving Circles

African-American Asian/Pacific Islander Hispanic/Latino Jewish White non-Jewish

21% 16% 15% 14% 10%

“Members typically claim that they feel giving circles allow them to engage in giving that is more hands-on, innovative, and transformative than traditional philanthropy, and more focused on seeking social change than simply on charitable giving that helps others,” the study authors wrote. Those making planned gifts also tend to seek transformative change, according to other research.

Pentera has long recommended that planned giving professionals help prospective women donors make connections with other women donors, either individually or through giving networks. Research shows that women who network with other women donors are more likely to give more. Now it appears that minorities of both genders also benefit from participating.

The study found that there is more of a gender balance among minorities in giving circles. While white non-Jewish participation is 66% female, women and men are balanced 47%-53% among non-white participants.

The study, released during the summer by the nonprofit research lab Jumpstart, is the fifth in a six-part research series commissioned by a consortium of foundations. New research on giving circles was conducted and blended with previous studies on religious giving.

In its major findings, the study also concluded that participation in giving circles can:

• Help deepen social and communal connections.
• Help participants acquire a greater awareness of the philanthropic and cultural traditions specific to their ethnic, religious, or affinity group.
• Empower people of diverse socioeconomic backgrounds to think of themselves as philanthropists.
• Encourage a collaborative mindset and democratic approach to charitable allocation.

You can register and download “Connected to Give: Community Circles” and the other parts of the research series at www.connectedtogive.org/reports.

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