There has always been a notion in the back of our minds that rich people become rich because they are greedy and desire money more. We also have notions that because we think they are greedy, they also must be very stingy in their giving and keep all of their money to themselves. Most of us never take the time to look into our preconceptions about people and find out the truth. Let’s take a look this notion and figure out if the rich actually give less, or if we are mistaken.
The first question we have to ask is what defines “rich.” Is it a certain income, a certain net-worth, the amount of stuff you have? There is no universal definition, which makes it very difficult to separate who is rich and who is not. We also have to define what is an acceptable amount of giving.
There is jus not a lot of data out there, but a recent study of the San Francisco Bay Area might shed some light onto the situation. The study found that of a group of wealthy people that had an average of $1.87 million in investment assets, their average charitable contribution was $23,222. This is only about 1.2% of their total income.
1.2% is probably a bit less as a percentage than the national average. The Catalogue for Philanthropy tells us that the average giving rate in North America is 3.8% of one’s income, coming in at a total of $4,012 for each person. As a percentage of income, wealthy people tend to give a bit less, but overall, the sheer amount of money they give is much more.
At this point it really becomes a question of obligation. Should everyone be expected to give the same amount of money, or should everyone be expected to pay the same percentage? Depending on what you answer, rich people are either doing very well or very poorly.
There are some wealthy people who give out extensive percentages of their income. For example, Bill and Melinda Gates plan on spending most of their wealth before they are dead as part of their charity, and they are the wealthiest couple in the world! Of course there are other wealthy people who don’t do so hot when it comes to giving. They do not make it a priority and instead focus on growing their wealth. Others are just outright greedy. Some people do not think they are wealthy, and instead focus on providing future security for themselves.
When all is said and done, wealthy people aren’t any more or less givers than those who have less money. We all average out to be about the same in our giving habits, and our preconceptions about the rich are most likely wrong.