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Giving: An attribute of young millionaires

Giving: An attribute of young millionaires

Younger millionaires feel a much stronger sense of personal responsibility than do their older peers.

If you were a millionaire, how would you use your money?

George Soros, Bill Gates, Warren Buffet and Mark Zuckerberg are some who have pledged much of their assets to helping others.

Some young millionaires are trying impact investing—which is putting money to use with an eye not just on financial returns, but on bringing about social or environmental change—becoming a divisive topic among different generations of wealth, according to a new report.

A survey commissioned by RBC Wealth Management, that reached 1,051 individuals around the world with at least U.S. $1 million in assets, asked how strongly respondents agreed or disagreed with the statement: “I feel a personal responsibility for my wealth to benefit broader society.”

While only 8% of U.S. millionaires 64 and older strongly agreed, more than three times as many Gen X and millennial millionaires did so: 27%. Only 9% of younger millionaires chose “strongly disagree,” compared with 21% of older millionaires.

The young are putting their money in wealth planning

Members of Gen X and millennials also seem to work harder to put their money where their mouths are. When asked how they worked charitable giving into wealth planning, 29% agreed with the statement that “I align my investments with my giving goals (e.g., through impact investing),” and 39% agreed that “Where relevant, my spending aligns with the causes important to me (e.g., buying sustainable products).”

Just 12% of older millionaires chose the impact investing answer, and 32% said their spending is in line with the causes that matter to them.

Gen X and millennials also felt stronger about passing on their values to a younger generation, at 43% to the older generation’s 25%. (That resonates with young billionaires as well: Witness the open letter Mark Zuckerberg and Priscilla Chan wrote to their newborn daughter in 2015.) Younger millionaires in the RBC survey also felt more strongly about passing wealth on to the next generation (28% to 12%).

Read here on the billionaire investors who have donated most of their considerable net worth to charity.