In today's dynamic financial landscape, philanthropy has evolved into a critical pillar of sophisticated wealth management that goes beyond mere charity.

High-net-worth individuals and families are increasingly integrating giving into their long-term financial strategies, driven by both altruism and smart planning.

Recent data reveals a robust $1.6 billion in grants made through Foundation Source clients in 2025 alone, signaling a resilient and growing commitment to philanthropy.

This article explores how to harness this momentum for personal and societal benefit.

The Resilience of Modern Philanthropy

Philanthropy has proven remarkably resilient, even amid economic uncertainties and global challenges.

What's changing isn't the generosity—it's the strategy, as donors seek more purpose and impact.

From 2021 to 2025, private foundation giving saw significant growth, with smaller foundations often exceeding the IRS minimum distribution of 5%.

• In 2021, nearly 1,000 foundations with assets between $1 million and $500 million disbursed $689 million total.
• Smaller foundations ($1M–$10M) gave an average of 8.9% of their assets, showcasing a high commitment to charitable causes.
• By 2025, giving momentum continued, with over 71,000 grants totaling $1.6 billion to more than 27,000 recipients.

Top causes included education, public benefit, and human services, reflecting donors' priorities.

Navigating Post-Pandemic Giving Shifts

The pandemic era brought a surge in broad-based giving, but post-2020, patterns have normalized toward more focused approaches.

Donors are now making fewer, larger grants and concentrating on specific purposes rather than general support.

• There has been a 64% drop in individual grants compared to peak pandemic levels.
• Grants for human services and public benefit have declined, while education remains a top priority.
• This shift indicates a strategic move towards long-term impact rather than emergency response.

Understanding these trends helps donors align their giving with evolving needs and maximize their influence.

The Impact of Tax Reforms: OBBBA 2026

Upcoming tax changes under the One Big Beautiful Bill Act (OBBBA) are set to reshape philanthropic planning starting in 2026.

These reforms include new deductions for non-itemizers and caps on itemized deductions for top earners, prompting a need for proactive strategies.

• Key changes involve above-the-line deductions and adjusted AGI thresholds for individuals and corporations.
• Donors should accelerate gifts before 2026 to optimize tax benefits under current rules.
• Consider contributing appreciated assets from recent market gains to leverage tax efficiency.

Advisors play a crucial role in navigating this complexity, offering personalized guidance for timing and efficiency.

Strategic Vehicle Selection: Foundations vs. DAFs

Choosing the right philanthropic vehicle is essential for achieving both financial and charitable goals.

Private foundations and donor-advised funds (DAFs) offer distinct advantages, depending on donor preferences and resources.

• Private foundations provide high control and family involvement, often outperforming minimum distribution requirements.
• DAFs offer simpler administration and are highly tax-efficient, especially for appreciated non-cash gifts like stocks.
• Other tools include charitable gift funds and pooled investment vehicles for diverse needs.

Here's a comparison of key features to aid in decision-making:

Investment Allocations in Charitable Portfolios

How philanthropic assets are invested can significantly impact the sustainability and growth of charitable giving.

Different foundation sizes adopt varied investment strategies to balance returns, liquidity, and mission alignment.

• Smaller foundations ($1M–$10M) typically allocate 61.5% to equities and 12.4% to cash for liquidity needs.
• Larger foundations invest more in alternatives, such as private equity, with about 23.5% in such assets.
• DAFs emphasize appreciated securities and crypto donations, which have seen a 1,242% increase since 2020.

Proper portfolio management ensures that charitable funds can support causes for years to come.

Emerging Trends and Future Outlook

Looking ahead, philanthropy is poised for further transformation with technology, demographics, and donor behavior driving change.

DAFs are outpacing overall giving growth, reflecting a shift towards more accessible and resilient charitable tools.

• Community-centered giving and sustainability focus are becoming key trends for 2026.
• Donor behavior shows rising complexity, with more collaborative funds and intermediaries involved.
• A Church Mutual survey indicates that 25% of U.S. donors plan to cut giving in 2026, highlighting economic caution.

Despite challenges, philanthropy remains a stabilizer in uncertain times, offering a pathway to meaningful legacy building.

Practical Steps for Integrating Philanthropy into Your Wealth Plan

To make philanthropy a core part of your wealth strategy, start with clear goals and informed decisions.

Here are actionable steps to get started or refine your approach.

• Assess your financial position and charitable interests to define giving priorities.
• Consult with advisors to explore vehicles like DAFs or foundations based on your assets and tax situation.
• Maximize the use of appreciated assets for donations to enhance tax benefits.
• Review and update estate plans regularly to incorporate philanthropic goals.
• Monitor trends and adjust strategies to stay aligned with evolving charitable landscapes and regulations.

By taking these steps, you can ensure that your giving is not only generous but also smart and impactful.

Philanthropy, when woven into wealth plans, becomes a powerful tool for creating lasting change.

Embrace this journey with confidence, knowing that strategic giving can enrich both your legacy and the world.