A Majority of Wealthy Americans Increase Gifts to Charity as Stocks Keep Soaring

More than three-quarters of the wealthiest Americans, most of whom have scored big gains in the roaring U.S. stock market of the 1990s, say they have become more inclined to give to charity as a result, according to a new report.

About 70 per cent of the people surveyed said they would continue to increase their giving in the future, even though they expected the hot market to cool down.

The findings are good news for charities, “who clearly are going to benefit from affluent Americans’ windfall in the stock market,” said Jeffrey S. Maurer, president of U.S. Trust Corporation, an investment-management company in New York that sponsored the survey to evaluate how attitudes have changed as a result of the market’s performance.

“Our findings indicate that the bull market has not stimulated an extravagant spending spree by affluent Americans,” Mr. Maurer said. “Instead, they have reacted conservatively and responsibly, increasing their contributions and their savings.”

The study is based on interviews with 150 people with an annual adjusted gross income of more than $225,000 or a net worth of at least $3-million — which puts them among the wealthiest 1 per cent of all Americans.

Such Americans have increased the amount of money they are saving, which now accounts for about 24 per cent of their disposable incomes, compared with 19 per cent in 1993, the report says.

As a result of the affluent investors’ market earnings, 62 per cent of those surveyed said they have donated more money to charities, churches, or synagogues. Some 56 per cent have made gifts to their children or other relatives.

Affluent Americans have seen their U.S. stock holdings increase by an average of 70 per cent since 1993, the report says, while their net worth has increased by 43 per cent. Only 6 per cent of those surveyed said they had not personally benefited at all from the market’s performance.

Asked to predict their future behavior, 70 per cent said they were likely to increase their contributions to charity or religious institutions; nearly that many (69 per cent) expected to make gifts to their children or grandchildren. Forty per cent said they had changed their estate plans in the past five years as a result of their market gains.

Three-quarters of those surveyed said they were staying invested in the stock market because they expected their earnings to provide them with a comfortable retirement — although only 13 per cent say they had retired earlier as a result of those gains.

Free copies of “U.S. Trust Survey of Affluent Americans XIV” are available from Allison C. Kellogg, senior vice-president for marketing and corporate communications, U.S. Trust, 114 West 47th Street, Sixth Floor, New York 10036-1532; (212) 852-1134.