BEFORE HE FOUND SUCCESS, Walter Berry was like many entrepreneurs—optimistic, stubborn, hard-working and personally acquainted with failure. After pursuing several lines of work without success, the sometime inventor created a device that revolutionized the way steel is produced. In 1968, at age 67, he sold his company for a very tidy sum.
With more money and time than they had ever enjoyed, Walter and his wife, Idun, decided to put their energy into a cause that meant a great deal to them: helping kids. The couple, who had no children of their own, began by donating to children's hospitals but soon felt the need to take a more direct approach.
So in 1990, with the help of Robert Demmler, their Merrill Lynch Financial Advisor, and attorney Walt Borneman, they created the Walter V. and Idun Berry Foundation. Its mission: to support researchers who were focusing on finding a cure for some of the most daunting childhood diseases—people who shared Walter's persistence, vision and innovative spirit.
Today, even though Walter and Idun are no longer alive, the foundation remains a dominant force in pediatric medical research, funding breakthrough after breakthrough. With Robert Demmler's son Christopher managing its day-to-day operations, Walter and Idun's legacy of caring lives on.
Get Ready for an $8 Trillion "Longevity Bonus"
When the Berrys began their quest, their targeted, hands-on, results-oriented vision of philanthropy was rare. But it's fast becoming standard operating procedure for a new generation of givers. Over the next two decades, as members of the baby boom generation break free from many of the constraints on their time and money, they will donate an estimated $6.6 trillion and some 58 billion hours of volunteer time, valued at $1.4 trillion, to causes they believe in, according to calculations by Merrill Lynch and Age Wave, an organization that studies the challenges of aging. That's a total of $8 trillion in giving—a sum that has the potential to change, well, everything.
An $8 Trillion "Longevity Bonus"Value of the time and money boomers will contribute over the next 20 years
How they intend to invest that dividend is explored in depth in Giving in Retirement: America's Longevity Bonus, a landmark study conducted in July 2015 by Merrill Lynch in partnership with Age Wave. The report focuses in particular on the philanthropic attitudes and practices of those 65 and over—a group that will grow by 57% over the next 20 years. Their impact on society, says Ken Dychtwald, president and CEO of Age Wave, will be enormous. "This generation isn't just primed to transform giving—they're also going to change the way we think about retirement and the contributions that older Americans can make."
The Best Time to Give Back
As older Americans begin to shed their professional responsibilities, they have more time to focus on what they can accomplish through their charitable giving. They're also at a point in their lives when they typically have more money to give. So it's perhaps not surprising that two-thirds of those surveyed for Giving in Retirement: America's Longevity Bonus say that retirement is "the best time in life" to give something back to their own communities or the wider world.
"Before I retired, I just wrote checks to charities. I didn't have time for anything else," said one of those surveyed. "In retirement, I give my money, my time and myself. Now I can really feel the difference I am making."
According to the study, people in their "retirement years" have an average of more than 70 hours a week of free time, and they donate, per capita, three times as much as younger adults—$1,672 annually for those 65 and older versus $555 annually for those 25 to 34. "As the boomers enter retirement," notes Donald Greene, managing director of Philanthropic Solutions for U.S. Trust, "they recognize clearly what giving means to them, and they're committed to making giving a focus throughout their retirement years—from how they think about it to how they engage in it and build it into their planning."
81%Top reason to give: "Making a difference"
The reasons retirees cite for their giving range from expressing their religious or spiritual beliefs to the friendships they gain. But the primary reason is "making a difference in the lives of others," with a full 81% of those participating in the Age Wave study identifying that as their primary motivation. That's compared with only 16% who say they do it for the tax deduction.
16%Least cited reason to give: "For the tax deduction"
In fact, 85% of those who were polled defined personal success as "being generous," as opposed to the 15% who tied success to their own wealth. The study also found that just as retirees are transforming giving, their giving is transforming retirement: Seven in 10 retirees say being generous is an important source of happiness. What's more, those who give money or time to the causes they care about are more likely to be both healthy and happy—another very good reason to give.
Show Me the Results
But the biggest shift uncovered by the study is in how today's retirees want to give. Boomers moving into their retirement years are bringing with them new attitudes toward giving. As has been true in so many other aspects of their lives, they want to create their own path. Compared with their parents' generation, the study found, boomers say they are more strategic and more demanding about how their time and financial contributions are used.
According to the study, boomers tend to believe that their generation is less likely than their parents' generation to prefer giving to large charitable organizations, and less likely to believe that charitable organizations spend their donations in the best possible way. Boomers also believe they are more likely than their parents' generation to seek information that would help them understand how charities use donations, and more likely when donating to specify how their donations would be used. Indeed, almost one-fifth of respondents over 65 express an interest in starting their own foundation or nonprofit to support the causes they care about. And 77% say they prefer to give while they're alive so that they can see the results of their generosity.
Certainly, the Berrys felt that having their own foundation allowed them to make sure their gifts were used exactly as they intended—and to see the results for themselves. "Walter was the driver," Robert Demmler says. The couple chose Stanford University School of Medicine to be the foundation's partner. Working closely with a fellowship selection committee of renowned researchers headed by Dr. Mark Kay, they selected fellows who not only focused on childhood diseases but also shared the couple's persistence and determination to succeed in the face of inevitable setbacks.
Over the foundation's 25-year history, the results have been deeply gratifying for everyone involved, including Demmler and his son, Christopher. The Berry Foundation has supported nearly 100 researchers, many of whom have made substantial leaps in treating childhood diseases. For example, former Berry Fellow Kari Nadeau has made groundbreaking discoveries in the causes of asthma and food allergies that plague children, while former fellow Ravi Majeti is testing an innovative medicine that may render some childhood cancers defenseless and allow the body's immune system to destroy them.
Getting Started, Finding Guidance
Trusted advisors like the Demmlers can be a valuable source of clarity and support for those who want to make giving a critical piece of their families' financial lives. The report found that while older Americans want to take a more personal, hands-on approach, many aren't sure how to get started: 39% state that there are "too many options to choose from." And 41% say they're worried about the trustworthiness of charities.
The study also uncovered a lot of room for improvement in the way families communicate about their charitable preferences. While 77% of respondents considered it important to have a conversation about giving with their spouses, only about 22% have actually discussed the issues philanthropy experts consider essential: where a couple's passion for giving lies, how much volunteer time and money they can give, what they see as the most effective way to give, and how to involve other family members. A knowledgeable financial advisor can help start that conversation and see that it stays on track.
As Giving in Retirement: America's Longevity Bonus makes plain, the Berrys' hands-on, results-oriented approach is one that many older Americans today aspire to. They want the power of their generosity—all $8 trillion of it—to be felt not only in the world that their children will inherit but also for generations to come.
The Walter V. and Idun Berry Foundation offers proof of the power of this approach—it's still doing exactly the kind of work its founders had intended. "The board continues to be dedicated to medical research that helps kids," notes Christopher Demmler. "It doesn't get any better than that."
3 Questions to Ask Your Advisor
- What are some ways I could potentially increase the impact of my donations?
- How can I involve my children in our family's giving efforts?
- Could a foundation help me build a legacy that keeps on giving long after I'm gone?