Women are taking a larger role in their family’s financial leadership and decision making processes. This is either by choice, or by circumstance (e.g. in the case of widowed or divorced women). Whereas in the past, they may have not been as involved in the allocation of family funds, many women are now equal partners or the primary decision maker in the process how family funds are to be allocated. This, of course, includes the distribution of family funds to charities and foundations. Through my discussions with charitable organizations, the organizations recognize that the donor landscape is changing as a result, and are learning how to attract and cultivate donors in this “new marketplace”.
In my professional experience, a woman’s decision to donate to charity is based upon certain factors. As women generally live longer than men, they often give more consideration to the question of “Will I have enough money to last through my lifetime to fund my living and health-care related expenses?” As a result, they can be more cautious in the decision to donate money (even if it can be done on a tax-efficient basis) as they will want to ensure that they have the necessary family funds to last through their lifetime. Financial advisors are key partners in this client discussion to assist clients with the necessary analysis to make this determination.
Women may also enjoy close personal relationships with certain charitable organizations. Women may develop a social connection with an organization either by themselves or with friends. This close relationship allows women to have a deep understanding of the organization’s goals, objectives, and impact – a key factor in the charitable decision making process. I have found that prior to making a donation commitment, women want a strong understanding of the impact that their donation dollars will have in the community. There is also an expectation that the charitable organization will follow up with the donor on a transparent and timely basis after a gift has been made and funds have been put to use. Charitable organizations are adapting to these expectations to ensure a successful donor experience.
I expect that charitable organizations will continue to evolve and tweak their donor cultivation practices to attract and strengthen relations with women. In the last few years, I have attended numerous “women-only” charitable events as a donor or with clients. I have found these events extremely enjoyable. It is clear that the charities are making a strong effort to positively market to their female donor base. These events provide a wonderful opportunity for women to learn more about an organization and seek information that is important to them in a warm, friendly environment. At these events, women often freely share information about their donation experiences with one another. I have found that women will listen closely to the experiences of their friends and family when it comes to making their own donation considerations, and these events allow an excellent opportunity for knowledge sharing.
I recently began working with a widowed woman after the death of her husband. While her husband was alive, he had been responsible for all of the family’s finances, including making decisions about significant charitable donations. When my client found herself on her own, without her late husband’s guidance to determine her financial future, she turned to her assembled team of advisors to assist. Throughout the education process that was untaken, she was able to confirm that she had sufficient assets to carry on her family’s charitable legacy. To continue her philanthropic future, she met with the organizations that she and her husband had donated to in the past, as well as interviewed new charitable organizations that had causes that were important to her. It was important that the charities took the time to answer all of her questions in a transparent manner. Although they charities may not have received the same questions in the past from her late husband, the widow was now the decision-maker with respect to charitable giving.
I would encourage advisors to continue to have a “philanthropic goals” discussion with all of their clients, and remind them to readdress the matter when there has been a significant change in a client’s circumstances (such as the death of a spouse or a divorce). As the population in Canada ages, a larger amount of wealth will be controlled by women (as they are expected to outlive their husbands). As well, younger generations of women are taking an equal role in the responsibility of financial decisions in their household. Advisors and charitable organizations must be aware that women use different considerations when making charitable decisions than perhaps the advisors and charities are used to addressing in the past. Learning about, and preparing for, these differences will ensure a better result for both our clients and the charitable organizations that they donate to.