The challenge of giving away your money

By Caitlin Kelly

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Interesting piece in The New York Times recently about a college class that teaches students about philanthropy:

Vinay Sridharan must make it through microeconomic theory and the writings of Proust before the end of his senior year at Northwestern in June. But in one course, the final project is far less abstract: give away $50,000.

It is also far more difficult than it may seem.

This course in philanthropy, endowed with a grant from a Texas hedge fund manager, requires students to find and investigate nonprofit organizations and, if they stand up to scrutiny, give them a portion of the five-figure cash pot.

“I didn’t realize they had real money to give,” said Margaret Haywood, the director of work force development at the Inspiration Corporation, a Chicago charity that received $25,000 from the Northwestern students last year.

The workshop — and others like it that have sprung up in the last few years at a dozen universities, including Harvard, Stanford, Princeton and Yale — offers a real-world experience of philanthropy that is rare in the cloistered halls of academia, and which otherwise is reserved for institutions and the affluent.

If you are fortunate enough to have income, and savings, beyond that needed for immediate basics — food, housing, health care, education, transportation, clothing — the question quickly arises:

How much, to whom and when will you give some of it away?

My working trip to Nicaragua in March with WaterAid, (which I blogged about here), introduced me to a terrific woman who is passionate about philanthropy and who blogs about it, Jennifer Iacovelli Barbour. Mother of two small boys, Jen lives in Maine — and the first time we met was in the Atlanta airport enroute to Managua, soon to share a small van in 95 degree heat for 12-hour days for a week. We had a blast!

Jennifer and I at Bilwi airport, after arriving in a 12-seater airplane.
Jennifer and I at Bilwi airport, after arriving in a 12-seater airplane.

It was such a tremendous pleasure to spend time with people who care so deeply about the work they are doing, and whose work is changing people’s lives for the better.

I also wrote recently about this question of legacy for the Times:

The decision-making process should begin with some philosophical questions, said Isabel Miranda, a partner in the Bloomfield, N.J., law firm Pearlman & Miranda. Ms. Miranda, a former bank trust officer, now specializes in helping clients plan their wills, trusts and estates.

“Who do I owe my success to? What values do I want to reflect? How do I want to pay back the organizations I believe in?” she said.

The subject is an interesting one, since not everyone has children to leave their assets to — we don’t and nor are we close to young cousins or nieces or nephews — and we’ll need to make thoughtful decisions about who are the best stewards of our hard-earned dollars.

In my case…I’m still not sure.

One organization I am passionate about, which supports the work of journalists who cover traumatic issues (war, violent crime, health, conflict) and helps them recover afterward is the Dart Center, so they’re on my radar already.

Sorry to say, I doubt my alma mater will get anything, as I found it sadly impersonal and bureaucratic, even if I did get a decent and affordable (Canadian) education.

One charity I now support with my time and skill is the Writers Emergency Assistance Fund, which can grant up to $4,000 within a week to qualified non-fiction writers facing financial crisis. Please donate here!

Do you make charitable donations?

To whom and why?

 

 

The View From One PercentLand

View of the Upper East Side, New York, from 96...
The Upper East Side of Manhattan. Image via Wikipedia

On the Upper East Side of Manhattan — an enclave of almost unimaginable wealth — it’s One Percent Central. The streets are clean, swept, silent, the wrought-iron-covered apartment doors — owned, not rented — always guarded by wary, watchful doormen.

Elegant townhouses with silk balloon shades, Met-worthy art and exterior security cameras sell at the price of some small nations’ GDP — this one is offered at $23 million — often in  all-cash deals.

Local hotels include the Carlyle, The Plaza Athenee and the Mark; room rates start about $700 a night. (New York State’s highest unemployment benefit, taxable of course, is $405 a week.)

Discreet private art galleries dot the side streets, $50,000 drawings locked behind elegant double doors. Shoppers, if they carry any bags, tote those marked Chanel, Ferragamo, Prada. They sleep on monogrammed linens from Leron, Frette and Pratesi.

Gleaming, spotless black Escalades, chauffeurs at the wheel, glide through the streets. Thin blond women skitter by in Louboutins. Private school boys, shouting, run down Fifth Avenue, their ties flying.

One building even has its own book, 740 Park Avenue, home to some of the world’s wealthiest people. One of its residents, a journalist married to a billionaire, allows peeks into her gilded world from time to time. But many One Percenters only appear in print on the Forbes or Fortune lists of the world’s wealthiest — or Bill Cunningham’s weekly round-up of society parties in The New York Times.

Summer and winter are verbs to this set — summer in the Hamptons, Nantucket, Maine, Newport, Martha’s Vineyard, winter in Aspen, Vail or St. Bart’s.

To the people inhabiting this world, the rest of us are barely a blip on the radar.

They are all privately educated from infancy, as are their parents, grand-parents, husbands and wives, their children prepped by SAT tutors costing thousands a month beyond the $35,000+ a year it costs to educate each child.

Their world is cocooned by nannies — likely three, one for each eight hour shift — au pairs, staff, multiple homes, private jets.

This divide is perhaps more obvious when you live in a major city split neatly by zip code by race, class and wealth: New York, London, Paris, Sao Paulo, Mexico City. Living in New York, all you have to do is exchange one subway line for another to visit a wholly different world, from one filled with the exhausted working class traveling home to Queens or Brooklyn, to another snuggled deeply in triple-ply cashmere, oblivious to mundane worries like finding or keeping a job, educating one’s children or even paying the rent or mortgage.

Mortgage?

I know something of this world. My first husband was a physician, who, with his second wife, earns a combined income of $500,000. Even with a few kids to support, that’s pocket change to the real One PerCenters — if an impossible fortune to most of us.

Some of my mother’s family were also members of it.

Unless you’ve been exposed to the people living in this charming snow-globe, and their ferocious determination to acquire their fifth home or the 20th Birkin handbag or the Monet coming up at Sotheby’s, it’s a reassuring fantasy to think they care about the rest of us. They’re too busy out-ranking one another to even notice people whose annual income barely covers their shoe budget.

Don’t ever underestimate their determination to retain their privileges and the sources of their economic and political power.

The mayor, a billionaire, lives in the nabe, in two townhouses (only a few of his residences), on East 79th. Street. His long-time live-in partner, Diana Taylor, sits on the board of Zuccotti Park, the privately-owned Manhattan park where the Occupy Wall Street crowd has pitched its tents.

Meanwhile, reports Bloomberg BusinessWeek, median household income in the U.S. has fallen to $49,445, the lowest in more than a decade, while poverty has jumped to 15. 1 percent, a 17-year high.

Read this  smart column by Times’ writer David Brooks on how the media, much of it [guilty!] based in Manhattan is still over-focusing on this obviously uber-wealthy one percent — rather than the deeply growing divide between those who are well-educated and those who are not, more visible in rural areas and smaller cities nationwide.

And yet…here’s a glimmer of hope — Resource Generation, an organization of younger Americans who have inherited or earned wealth dedicated to re-distributing it more equitably.

Do you see an economic divide where you live?

How’s it playing out?