News

Wealthy SoCal Residents Donate Twice as Much as NorCal Affluent

Tuesday, December 26, 2006

SAN FRANCISCO, December 26, 2006 -- Affluent Southern Californians donate twice as much money to charities as their well-off counterparts elsewhere in the state, according to a new study released Tuesday.

But not so fast. If all contributions were factored in, including a small group of blockbuster donations from Northern California, the average amount given would make Silicon Valley the most generous region of the Golden State.

The study, by San Francisco-based philanthropic researcher NewTithing Group, examined tax returns of people in California who made $200,000 or more in 2004, the most recent year the data was available.

The group compared the amount that affluent Californians declared as charitable donations versus their wealth from investments, which included stock holdings and private investments but not real estate and retirement pensions.

The measurement was meant to provide a more meaningful gauge of generosity than only looking at income, the group said.

Researchers looked at the median, or midpoint, of the amount given in each region rather than the average amounts, which they said were unfairly skewed by super-large donations from a small group of Northern Californians.

By that standard, affluent people in Los Angeles County donated the greatest share of their wealth, giving about $4,923 each, or 0.99 percent of $497,000 in investment assets. The numbers were similar in other counties throughout Southern California.

Affluent people in the central coast and valley areas - including Sacramento, San Luis Obispo and Fresno counties, among others - held the most investment wealth but gave the smallest slice, at just $3,590 each, or about 0.46 percent of $778,778 in investments.

Silicon Valley, which includes San Mateo and Santa Clara counties, didn't fare much better, with people parting with just a fractionally higher amount, nearly 0.47 percent of their investments. The areas including San Francisco and other parts of Northern California came in at roughly the same range.

But when looking at the average amount donated compared to investment assets, rather than the median, wealthy individuals in Silicon Valley came out on top, giving $23,122 each, or about 1.24 percent of $1.87 million in investment wealth.

Using that measurement, people in Los Angeles still gave slightly more money - $23, 172 each. But that amount represents a significantly smaller percentage of their individual wealth - about 0.93 percent of $2.26 million in investment assets.

Tim Stone, executive director of the NewTithing Group, said the group chose to emphasize the median measurements to present a clearer picture of the contributions from the typical affluent individual rather than a few philanthropic superstars.

He said one aim of the study was to convey the need for charitable givers throughout the state to start thinking more about their donations as a percentage of wealth rather than income.

"Many of us give by the seat of the pants," he said. "We give piecemeal, and at the end of the year we just add up how much we give. But if you give by proactively budgeting for charity, you might be more apt to give proportionately."

Philanthropy groups in Silicon Valley said the influx of new money could be one reason behind the regional discrepancies.

"A great deal of the wealth in Silicon Valley is relatively new," said Michelle McGurk, spokeswoman for the Silicon Valley Community Foundation, which will have $1.5 billion under management when its merger takes effect Dec. 31. "Generally it takes a while for folks to create patterns of charitable giving and put down roots in the community and start to give back."

Get more News »