By: Maria Williams
Individual philanthropy is a driving force for positive change within local communities and society as a whole. Valerie Grant, CFA, firmly believes in the power of giving and emphasizes the critical role individual donors play in supporting the non-profit sector and advancing social causes.
This belief is backed by compelling data on charitable giving in the United States. According to the Giving USA Foundation, in 2023, individual donors contributed $374 billion to charitable giving in the United States, compared to $104 billion for foundations and $37 billion for corporate donors.
When people think about philanthropy, they often focus on “mega-donors,” individuals who make particularly generous contributions to non-profits, typically in excess of $10 million.
Notable examples include Robert F. Smith, who famously paid off $34 million in student loan debt for nearly 400 graduating seniors at Morehouse College, and Melinda French Gates, who has championed education, global health, and women’s empowerment through the Bill and Melinda Gates Foundation and her current venture, Pivotal Ventures. Oprah Winfrey, through her charitable foundation, has donated over $400 million to organizations focused on education and community outreach, and philanthropist Mackenzie Scott has granted nearly $15 billion to almost 2,000 organizations in the United States between 2018 and 2023—a staggering achievement.
Given the scale and publicity surrounding such generosity, many individual donors may question whether their contributions are necessary or impactful. The answer is a resounding yes. While mega-donors are vital, philanthropists who give at more modest levels also play an essential role in the philanthropic ecosystem.
In this article, Valerie Grant shares her motivations for giving and offers insights to help others begin their own philanthropic journeys.
Distinguish Between Philanthropy and Community Service
Philanthropy and community service are both crucial for improving society; however, they each offer distinct benefits, advantages, and disadvantages. Philanthropy focuses on creating long-term, generational impact through substantial financial contributions to non-profit institutions. Philanthropic giving is often used by organizations to create or increase an endowment, a long-term investment fund that provides sustained support for a specific purpose.
Typically, only the income from the endowment can be used to fund programs. In contrast, community service involves hands-on work to address immediate needs within a community, and service projects are funded by annual contributions that must be replenished once the funds have been spent. The impact, while significant, is short-term by definition.
Define Your Philanthropic Priorities
The first step in any philanthropic journey is defining your priorities. Valerie suggests asking yourself the following questions before you start giving:
- What are my core values?
- Which social issues matter most to me, and why?
- Where would my contribution have the greatest impact?
Valerie’s philanthropic journey underscores the importance of clearly defined priorities and legacy. She focuses on higher education, the visual and performing arts, international affairs, and services to youth. Valerie shaped these priorities by reflecting on meaningful experiences and institutions in her life and a desire to ensure that similar opportunities are available to future generations.
As you define your own priorities, identify issues that resonate with your values, life experiences, and areas of interest. Focus on the ones that are significant to you, your family, and your community. Finally, consider where your contribution can make the greatest impact, locally, nationally, or globally.
Photo: Unsplash.com
Find Organizations That Align with Your Goals
Finding the proper organization to support is both crucial and challenging. Conduct thorough due diligence to ensure that an organization’s values and mission align with your goals. Start by reviewing their impact and financial reports to vet the organization properly. Consider a membership program or advisory role as a way to get to know the organization and its leadership team. This involvement can give you a behind-the-scenes look at the organization’s work. You may be inspired to pursue active involvement, such as joining the board of directors, or a more passive commitment of funds. Both options can be extremely rewarding.
Link Philanthropy to Financial Goals
No matter how much you wish to give or which organization you choose to support, it is essential to align your philanthropic vision with your financial goals. Start by examining your budget and determining how much you can donate. Then, decide how much you will give during your lifetime and how much you plan to donate posthumously. Consider whether you want to give away a specific percentage of your annual income or net worth by a specific date and how you will balance leaving assets to family versus giving to philanthropy.
Planning ahead allows you to better control the implementation of your wishes. Consult with a financial or tax advisor to determine which methods will maximize the impact of your giving—options include direct donations, charitable remainder trusts, private foundations, donor-advised funds, and limited liability corporations.
Decide Whether Recognition Matters
Do you want public recognition for your giving? Some people prefer to donate anonymously, while others enjoy attending events like galas and ribbon cuttings. Determine how visible you want to be and communicate your preferences to the organization, including whether you wish to remain anonymous. Additionally, you might consider giving in honor of someone else—a family member, a historical figure, or an individual who has significantly influenced you or the field you are passionate about.
Implement Your Plan
The final step in your philanthropic journey is to get started. Similar to investing, you can start with a small commitment and increase or decrease your contributions over time.
Valerie’s parents instilled in her the value of making a long-term impact. Her father helped establish the Kappa Scholarship Endowment Fund (KSEF) in Washington, D.C., with a philosophy of accumulating capital to distribute income from the endowment rather than immediately disbursing funds. This approach, unusual at the time for a small community-based foundation, has enabled the Fund to grow its endowment while providing over $2 million in scholarships to more than 700 graduates of Washington, D.C. public schools since its inception.
Each year, two students receive four-year scholarships from the Fund through a named scholarship her parents established many years ago.
Valerie and other contributors established two additional endowed scholarships in honor of her parents, one at Savannah State University – her parents’ alma mater – and another through the PVAC Fund, a private community-based foundation in Montgomery County, Maryland.
Conclusion
Individual philanthropy, whether at a mega or modest level, is a powerful tool for effecting change and leaving a lasting legacy. By defining your priorities, aligning your giving with financial goals, and carefully selecting organizations that resonate with your values, you can make a meaningful difference to institutions and causes that are important to you. Valerie Grant’s journey demonstrates that thoughtful, strategic philanthropy not only benefits society but also enriches the lives of those who give. Whether you choose to contribute quietly or seek recognition, every act of giving adds to the collective impact that transforms communities and society at large.
About Valerie Grant, CFA
Valerie Grant, CFA, is a Managing Director and Equity Portfolio Manager at a global investment management firm. A thought leader in her industry, Valerie is a sought-after speaker and has been a guest lecturer and presenter at Harvard Law School, the Yale School of Management, and the CFA Institute. She also provides market commentary on CNBC, Bloomberg News, and other media outlets. She is a life member of the Council on Foreign Relations, a trustee at Morehouse College, and a member of the Harvard Business School Alumni Board. Valerie holds an MBA with high distinction from Harvard Business School and a B.S. in Economics from The Wharton School at the University of Pennsylvania.
Published by: Holy Minoza
