Study Finds Differences in How Economic Groups Donate

A new study suggests that charitable giving is closely tied to how people see themselves. For example, higher income individuals tend to give to charities when they are asked in a way that appeals to their self-concept of independence and self-reliance. Lower income individuals, however, give based on their perception of being part of a community and social connection.

The study, performed by psychologists Ashley Whillans, Eugene Caruso, and Elizabeth Dunn, looked at this phenomenon over the course of three experiments.

In the first experiment, participants were sent to the website for an organization called The Life You Can Save, which focuses on ending extreme poverty. Visitors were asked to participate in a survey in exchange for a complimentary book. Half of the 185 participants (58% of whom were female) read an “agentic” appeal for donations that emphasized the organization as one that focuses on what an individual can do to reduce poverty. The other 50% read a more “communal” appeal that focused on what “all of us together can do to reduce poverty.”

Wealthier participants—those earning $90,000 a year or more—were more likely to click to donate after reading the agentic appeal, while lower income participants—those making $40,000 or less a year—were more likely to donate after experiencing the communal appeal. Other elements like gender, ethnicity, and age made no difference.

The theory behind these results is that wealthier individuals see themselves as having more personal control and less need to rely on others. Those with lower incomes, on the other hand, rely more on other people. So when charitable organizations strategize their copy based on these ideas, they can potentially get more donations from either group.

While this particular study is too small for sweeping generalizations, it is backed up to a certain extent by previous studies, including one from 2010. That study, published in The Journal of Personality and Social Psychology, found that, despite their own financial hardship, lower income individuals were more generous, charitable, trusting, and helpful than their upper class counterparts. The study authors suggested that this was because lower income donors have a greater commitment to the sort of mentality that leads to involvement with charity, such as egalitarian values and compassion.

It’s too early to determine definitive conclusions based on this small amount of data, but it’s still valuable in the sense that it gives charities something to consider when deciding how they want to approach potential donors.

Eagles Singer-Songwriter Joe Walsh Launches New Charity

Joe Walsh, who played in the 1970s hit band the Eagles, has created a new charity that will benefit U.S. military veterans.

The charity, called VetsAid, will fund organizations that provide physical, mental, and emotional care to service members and their families. Giving veterans the support they need is an issue that hits close to home for Walsh; the singer-songwriter’s father was a flight instructor who died while on active duty in Okinawa, Japan.

“War is hell for everyone involved,” Walsh stated. “I lost my father when I was a baby, before I could even make a memory of him. I stopped counting the number of friends I lost in the Vietnam War or that came home forever scarred mentally or physically or both.”

In order to raise money for the charity, the talented musician will host a benefit concert in which he will play alongside Keith Urban, Gary Clark Jr. and the Zac Brown Band. Additional musicians will be announced at a later date, with a special closing performance from a mystery guest. The concert will take place on September 20 at EagleBank Arena in Fairfax, VA. Tickets will go on sale tomorrow.

“I had to do something and seeing as though rock and roll seems to be what I do best, it’s also the least I could do for those who have served and continue to serve our country,” Walsh remarked. “We’re all in this together as Americans and seems to me lately that people are forgetting that. I asked my buddies Zac, Gary, and Keith to step up and I’m so grateful that they did. Let’s put on a show, raise some money and celebrate our vets… and let’s do it every year!”

Way to go, Joe Walsh! Keep up the good work! You make our country proud.

Co-founder of Private Equity Firm Donating $1 Million to Northern Arizona University

Great news for education students at Northern Arizona University!

George Roberts, co-founder of private equity firm KKR, is giving $1 million to NAU to support education students during their student-teaching semester. The money will be divided into $5,000 scholarships.

The scholarships will be offered to first-generation college students from underrepresented demographic groups that have a demonstrated need for financial aid. The donation is part of Roberts’ greater mission to empower marginalized people.

“Those who complete college do better—they make more money and have more stable lives,” Roberts said in an interview with the Arizona Daily Sun. “It’s a way to break the cycle of poverty that keeps so many from reaching their true potential. If we’re ever going to improve the economic inequality in this country it’s going to be through education and jobs.”

Roberts is making the donation in honor of William A. Franke, a close friend of his whom he’s known for nearly 50 years. Franke is the cofounder and managing partner of Indigo Partners, a Phoenix-based private equity and venture capital firm.

When Roberts brought up the idea of making a donation in his name, Franke recommended NAU. Franke himself has been an avid supporter of NAU for many years, which is why NAU’s W.A. Franke College of Business is named after him. Those who receive the $5,000 scholarships will be known as Franke Scholars.

“We are incredibly grateful for George Roberts’ generosity,” said President of NAU Rita Hartung Cheng. “There is a significant need for high-quality teachers, and through this gift, George Roberts and Bill Franke will ensure that NAU students will become those exceptional teachers.”

At a time when tuition costs are rising and colleges are facing budget cuts, donations like this are invaluable. It’s especially important due to the fact that it creates more opportunities for minorities, who already face significant socioeconomic challenges.

Why You Shouldn’t Feel Guilty if You Can’t Afford to Donate

A lot of people find themselves asking, “When is the right time to donate?” The answer is simple: when all of your needs are taken care of first.

If that sounds selfish, allow us to explain why it’s not.

As a society, we’ve been conditioned to put others’ needs above our own. But when you sacrifice your personal necessities in the name of others, you’ll end up feeling stressed, dissatisfied, and unfulfilled.

Generosity is not supposed to make you feel that way. Giving to others is supposed to make you feel inspired, joyful, and exuberant. And the only way you’ll be able to experience those positive vibes is to give from a place of love rather than guilt.

If you’re not doing well financially, chances are you already feel bad about your situation. Don’t compound those feelings of guilt by giving away money that you don’t have.

And for the record, there’s nothing wrong with putting yourself first. In fact, in survival situations, it’s a necessity. Just think about how airlines encourage passengers to put their own oxygen masks on first before helping others.

Put another way, think about this quote from Eleanor Brownn:

“Self-care is not selfish. You cannot serve others on an empty vessel.”

If giving is your passion even though it’s not financially feasible to do so now, then use your current misfortunate as motivation to earn more income. In other words, it’s time to set some goals. Ask yourself the following questions:

  • How much money do I need to be making in order to cover my own basic expenses?
  • How much money would I like to give to charity?
  • What are some ways that I can increase my earnings?
  • What is a realistic timeline that I can set for myself to accomplish my financial goals?

Remember: just because you cannot donate now doesn’t mean that you’ll never be able to. Your current predicament is not your permanent predicament. There’s always room change, grow, and donate in the future.

How to Use Philanthropy as a Means of Marketing

In today’s competitive market place, it’s becoming harder and harder to promote one’s name, brand, or business. One unique and underused marketing strategy involves making a sizeable charitable donation.

If that sounds a little unethical, it’s not. There’s nothing with capitalizing on the opportunity to self-promote and do some good in the world­­­ at the same time—two birds, one stone.

No, seriously, it’s done all the time. In fact, it’s proven to be an effective strategy for celebrities, politicians, athletes, and business leaders alike.

Take, for example, this headline featured in The New York Times: Chance the Rapper Donates $1 Million to Chicago’s Public Schools. Is Chance the Rapper legitimately passionate about education and the arts? Absolutely! But was he also doing it as a means to garner positive press around his name? Probably. But again, there’s nothing wrong with that.

As a general rule of thumb, the larger the donation, the more press it’s going to get. But in some cases, a person or a company may not need to make national headlines. This is especially true of localized businesses whose target audience resides in the immediate area. In that case, a $20,000-$50,000 donation is enough to make the local papers or news stations.

But if the goal is to reach a wider audience, the donation will need to be substantially larger. How large? At least $100,000. But there are other factors to consider as well.

The type of charity that one gives to matters just as much (if not more) than the amount of the donation. Going back to the example of Chance the Rapper, his donation was particularly noteworthy due to his own personal background.

Chance the Rapper, whose real name is Chancelor Bennett, is a Chicago native who grew up in the West Chatham neighborhood. He decided to give to schools that are located in financially ailing districts—schools that coincidentally have a lot of minority students. Being African American, his donation made for a great story about how race intersects with money, education, and access to resources. That’s why the news of his donation made headlines.

Businesses looking to promote their services should seek to emulate this type of philanthropy. The best way to ensure that the donation will capture the media’s attention is to look at it through the eyes of the press. In other words, businesses should ask themselves this key question: is this a story that is engaging, interesting, and worth reading?