Philanthropy is often where generational differences in wealthy families become most visible. While it brings family members together around shared purpose, it can also reveal contrasting priorities, values and views on how capital should create impact. In many families, philanthropy becomes the first arena where different visions of legacy emerge.
Today, it is more important than ever to bridge this gap and ensure that as wealth passes through generations, family values and legacies are not left behind.
DIFFERENT APPROACHES TO GIVING
Family philanthropy can become complex because each generation often gravitates toward different causes and different ways of creating impact. Older generations often favor established structures such as foundations, legacy charities and endowed institutions. These approaches emphasize stability, continuity and long-term stewardship.
Younger generations, by contrast, are increasingly drawn to impact-oriented models such as venture philanthropy, social enterprises and impact funds. Enabled by technology and access to information, they often take a more data-driven and entrepreneurial approach to evaluating social challenges and funding solutions.
Rather than competing, these approaches complement each other. Just as investment portfolios balance stability with growth, philanthropic capital can be deployed across a range of strategies designed to achieve different objectives. For example:
Stability-oriented giving may include:
- Endowments to established nonprofit institutions
- Long-term partnerships with trusted charities
- Foundation grants supporting proven programs
Innovation-oriented giving may include:
- Venture philanthropy and early-stage initiatives
- Impact investing strategies targeting measurable outcomes
- Supporting social enterprises addressing emerging issues
ACHIEVING FAMILY UNITY
Even with differing philanthropic priorities, families can maintain continuity in the transfer of wealth and values. In fact, philanthropy is often one of the most effective ways to bring generations together in a shared decision-making process.
The encouraging reality is that most family members remain committed to giving in some form, whether through financial contributions, volunteerism, advocacy or shared expertise. A productive starting point is often a family meeting focused on shared values and long-term purpose.
Discussing the family’s legacy of giving and the causes it has historically supported can help identify common themes across generations. From there, families can develop a guiding mission that helps determine:
- Which types of organizations to support
- How philanthropic capital should be deployed
- How success will be measured over time
Many families strengthen alignment by introducing light governance structures, such as philanthropic committees or defined decision-making roles. These frameworks allow participation across generations while maintaining strategic direction.
Preparing the Next Generation
Philanthropy is often the training ground for future stewards of family wealth. Before responsibility for significant capital is transferred, families frequently use philanthropy to develop the skills the next generation will need to lead.
Through active participation in charitable initiatives, younger family members will build experience in judgement, leadership, collaboration and accountability. Allowing next-generation members to take ownership of specific initiatives, such as evaluating charities, managing small grant pools or overseeing passion projects can be particularly effective.
Some families create dedicated funds that allow younger members to support causes they care deeply about while remaining accountable for results and impact. These experiences provide a practical environment for developing stewardship skills while preparing the next generation to manage broader family wealth responsibilities.
Families can further reinforce shared purpose by participating in philanthropic activities together. Volunteering, visiting nonprofit organizations or reviewing impact reports as a family helps strengthen both relationships and commitment to giving.
At BNY Wealth, we encourage our clients to consider the family’s philanthropic values as part of their overall wealth plan and to focus on shared values instead of generational differences. At its heart, philanthropic planning is about finding the best way to make a lasting impact on the legacies of both families and communities.
