Gen X-ers: Stingy or Strapped?

by Kimberly Palmer
U.S. News & World Report

Generation X-ers might not be getting out their checkbooks for charity as much as their parents' generation did, but they have some pretty good excuses.

Americans 25 to 36 years old donated just $592 on average in 2000, while those in the same age range in 1973 (mostly pre-baby boomers) gave away the inflation-adjusted equivalent of $1,214, according to research by Indiana University's Center on Philanthropy to be released this spring. The reason for the difference, however, is more complicated than mere stinginess.

"There's been a marked decline in giving to organized religion," says Dwight Burlingame, associate executive director of the center. Older generations attend religious services more often than their younger counterparts do, "and attendance translates into giving," says Burlingame.

Another factor is rising debt. According to the Government Accountability Office, the median debt held by households headed by those 25 to 34 years old (mostly gen X-ers) is just under $30,000, as measured in 1998 dollars. Baby boomers, on the other hand, held half that in debt during the same age span.

The GAO also reports that gen X-ers have lower net worth than their parents' generation did at the same age. The median net worth for households headed by 25-to-34-year-olds is $15,500; for baby boomers, it was $19,504, in constant dollars.

"This is the first generation this has happened to," says Burlingame. "More people are staying home longer, aren't as established, and don't have the same degree of wealth as their parents did [at their age]."

A winner-takes-all mentality may also dampen the giving spirit. As exemplified by the popularity of such television shows as CBS's Survivor, gen X-ers are comfortable with the idea of winners and losers in life, says historian Neil Howe: "The idea that everyone is guaranteed a future is alien to them."

Gen X-ers may also give less simply because they have not been asked, says David Stillman, coauthor of When Generations Collide (HarperCollins, 2002). "People say generation X doesn't give and isn't charitable, but the No. 1 reason people give is if they're asked," he says. Only now are large organizations starting to target gen X-ers, many of whom are already well into their 30s, he adds.

Some generous young Americans are paving the way for their peers. When Michael Gast, 26, an educator in San Francisco, had $40,000 left over in a trust from his grandmother after paying for college, he decided to give much of it away to social justice causes. He currently donates 5 percent of that trust each year and plans to give away a bigger chunk over the next few years. He also donates 10 percent of his $30,000 annual salary. "I feel I can live a wonderful lifestyle and also be giving in a generous way," he says.

As for big purchases like a house, he has discussed going in with a group of five or six friends on a home they would share. The pricey housing market, along with his philanthropic goals, "force me to come up with creative solutions," he says.

Copyright 2007 U.S. News & World Report, L.P. Reprinted with permission.