Millennial motivation: a closer look
Bank of America Private Bank’s Philanthropic Solutions group can help you anticipate and address your nonprofit organization’s needs. We complement our dedicated investment teams’ mission based approach to investment management with ongoing guidance on best practices in mission advancement, leadership development, and fiduciary review and support.
At a time when many nonprofit organizations are faced with an aging donor base and are trying to cultivate new support, increasing attention is turning to an emergent group of new leaders and influencers: millennials and Generation Z.
Born between 1997 and 2016, Generation Z (Gen Z) is considered the largest and most disruptive generation to date, accounting for one-third of the entire population.1 Millennials, born between 1981 and 1996 are in their prime years, making up over half of the current workforce and leaving their impact on everything from politics to the economy.2 Combined Gen Z, millennials and younger generations make up more than half of the U.S. population.3 The influence of these generations is anticipated to grow exponentially as the U.S. undergoes the “Great Wealth Transfer” that is expected to transfer an estimated $72.6 trillion to the next generation.4 Understanding and engaging these future leaders is essential for all organizations focused on their sustainability and growth.
- Gen Z's purchasing power is projected to represent $33 trillion in income by 2030, surpassing millennial income by 20315
- According to the 2021 Bank of America Study of Philanthropy, 81% of millennials and younger gave to charitable organizations in 2020
- Millennials and Gen Z were the most likely to have provided monetary assistance to someone during the pandemic6
- 55% of donors ages 38 and younger say they are more focused on the issues or causes they consider most important than on organizations (34%)7
Millennials and Gen Z tend to be tech-savvy and entrepreneurial, and they frequently look to engage with nonprofits on multiple levels, preferring to use their unique skill sets as well as their money. Despite being at different stages of their personal and professional lives and perhaps not at the peak of their earning potential, both generations have a desire to make an impact so it is important that organizations find ways to engage them. It is increasingly important for them to determine clear strategies for leveraging both in-kind and monetary contributions through social media outreach, peer networking events, e-newsletters and face-to-face engagement.
The next generation focuses more on societal issues and their ability to make a wider impact, than previous generations, who focus more on the work done by specific organizations. They believe in the power of activism and that together their voices can bring about real change. By developing programming that integrates the next generation into the mission of the organization while also providing leadership opportunities, nonprofits offer millennials and Gen Z the opportunity to gain a holistic perspective of organizational operations, including development strategies, programming and governance procedures. If done with intention, these engagements can translate to meaningful, long-term involvement—to the benefit of both nonprofits and their next generation leaders.
What inspires millennials to get involved?
To have a positive impact
To forge relationships
To enhance and leverage their expertise
Source: Bank of America Private Bank Philanthropic Solutions
In thinking about program and leadership engagement opportunities for millennials and Gen Z, nonprofits should consider tailoring their approach to fit the key motivations of the next generation. Tips for engagement include:5
The next generation generally prefers to ease into relationships with organizations before fully committing to a cause, so organizations should consider creating opportunities to pull them into their programming early on in ways that may not require full-fledged commitment. The initial engagement — such as volunteering at a specific event or program, participating in a single fundraising initiative, or attending a board recruitment event — should offer millennials and Gen Z the ability to better understand the mission, organizational structure and desired impact of the nonprofit.
Organizations should consider examining their leadership structure to find ways to make room on their boards, committees and volunteer programs for millennials to have the ability to actively participate in a manner that feels meaningful to them.
The next generation feels a personal sense of social responsibility that helps them to be engaged with an organization on many levels. To harness this strength, nonprofits should consider involving millennials and Gen Z in the development and implementation of concrete initiatives through appropriate committees and leadership positions. While all donors should be treated with high levels of attention from staff, development professionals should thoughtfully work to engage these generations in the institution prior to making any ask. For this group, feeling a sense of ownership can lead to an ongoing, fruitful relationship. Unlike previous generations the engagement of these younger generations is not linear, instead organizations need to create multiple ways in which individuals can learn, build trust and engage.
Perhaps most important, organizations can help millennials and Gen Z understand the tangible impact of the investment of their time, money and knowledge. A key differentiator between these generations and their predecessors is an emphasis on measured impact; the next generation tend to look for full transparency into how their philanthropic investment is moving the needle for an organization, pushing organizations to show clear metrics that resonate in order to keep them highly engaged.
Many millennials tend to be deeply connected to the world and their peers through social media vehicles such as Facebook, Twitter and Instagram; and Gen Z has never lived in a world without internet or smart phones. Their social media presence offers nonprofits not only unique and valuable insight into giving patterns and social interest areas, but also the opportunity to reach and influence this group. Organizations should consider approaching their social media with the same methodical intent as they would a development strategy. Investing in social media engagement like other aspects of their development should not be without personalization; organizations need to consider the platforms the next generation are most active on, the content they are most attracted to and what stories will resonate with them.
How we can help
We work closely with our nonprofit clients to offer strategic support and guidance in how to engage next gen leaders as thoughtful and impactful donors, supportive and educated board and committee members, and overall strong advocates for the organization through our extensive experience advising nonprofit clients.
We know the challenges our nonprofit clients face when working to meaningfully engage with millennials and Gen Z and can work with your organization to determine strategies and solutions for reaching this demographic as donors, volunteers, advocates and leaders.
Custom consulting services are available to clients with managed accounts of $10 million or more on the fiduciary platform.
2 Pew Research Center. Dimock, Michael. http://www.pewresearch.org/fact-tank/2019/01/17/where-millennials-end-and-generation-z-begins/ (Latest data available.)
4 U.S. High-Net-Worth and Ultra-High-Net-Worth Markets 2021. https://www.cerulli.com/reports/us-high-net-worth-and-ultra-high-net-worth-markets-2021
The 2021 Bank of America Study of Philanthropy: Charitable Giving by Aﬄuent Households
Advancement Resources. (2015). Generational Differences in Giving: Engaging Millennials. Retrieved from advancementresources.org/Blog/In-the-News/44/Generational-Differences-in-Giving-Engaging-Millennials.aspx.
Goldseker, Sharna & Moody, Michael. (2013) Young Wealthy Donors Bring Taste for Risk, Hands-On Involvement to Philanthropy. The Chronicle of Philanthropy. Retrieved from philanthropy.com/article/What-Young-Wealthy-Donors-Want/154831.
Sources and external websites are provided for educational purposes only. Inclusion here does not imply Bank of America Private Bank’s endorsement of any content or content providers.
The information and views contained in this publication are for informational purposes only and do not provide investment advice or take into account your particular investment objectives, financial situations or needs. They are not intended as a recommendation, offer or solicitation for the purchase or sale of any security, financial instrument or strategy. Any opinions expressed herein are given in good faith, are subject to change without notice and are only correct as of the stated date of their issue.
Institutional Investments & Philanthropic Solutions (also referred to as “Philanthropic Solutions” or “II&PS”) is part of Bank of America Private Bank, a division of Bank of America, N.A., Member FDIC and a wholly owned subsidiary of Bank of America Corporation (“BofA Corp.”). Trust, fiduciary, and investment management services are provided by wholly owned banking affiliates of BofA Corp., including Bank of America, N.A. and its agents.