Joining A Circle Of Philanthropy Is The Gift That Keeps On Giving

Consider joining or creating a giving circle, whereby individual donors pool their money–and other resources–and decide together where to give it away.

Originally Published Sept. 16, 2016

Looking for a way to express your identity as a member of the community and to leverage your capacity to make a difference? Then consider joining or creating a giving circle, whereby individual donors pool their money – and other resources – and decide together where to give it away. In essence, giving circles provide an opportunity for individuals to join others through collective charitable giving.

Collective Philanthropic Giving

Giving circles are a resurgence of an old tradition of generosity and caring that is making an impact all across the country. Giving circles have become an attractive channel of philanthropy for women, minorities, and donors under 40, according to a report prepared by Jumpstart Labs, a philanthropic research group.

Giving circles provide an entry point for donors with lower income levels and a desire to become involved in charity work, according to Jumpstart Labs. “It doesn’t surprise me that minority groups participate in giving circles at higher rates because of the effect that giving circles have in focusing and amplifying the effect of their giving,” Jumpstart Labs’ chief executive Shawn Landres told the Chronicle of Philanthropy. There is something exciting about people pooling their resources and making joint decisions on how to give grants to improve life in their community, he added.

Giving circles also provide opportunities for democratic participation through agenda setting, decision-making, and face-to-face debates and deliberation, and they build the capacities of their members through education about issues, organizations, and the skills of grantmaking, reports Nonprofit Quarterly.

Start A Giving Circle of Your Own

Step 1

Find like-minded people with whom you can pool funds and then distribute the income in the form of grants.

Step 2

Determine how much and how often each person is to donate. Members may chip in anywhere from $100 to $2,500 or more every month.

Step 3

Find a worthy cause or choose an agency (e.g., a pediatric cancer ward in a local hospital or a shelter for battered women) to whom the group will donate the funds.

Step 4

Decide where your giving circle will put its money before making a donation (e.g., savings, checking, or money market account), or if you want members to write individual checks to the cause you all agree to fund. Alternatively, decide whether you prefer a sponsor, such as a local foundation.

Some giving circles are supported by community foundations, which offer a variety of services to donors who wish to set up charitable funds without incurring the administrative and legal costs of starting independent foundations. The Council on Foundations’ Community Foundation Locator can help you look for a community foundation in your area. Other giving circles utilize a fiscal sponsorship arrangement, in which a 501(c)(3) public charity enables you to collect tax-deductible donations.