Ultra-wealthy donors step up as government funding retreats

Ultra-high-net-worth philanthropy reached $250 billion in 2025 – up nearly 32% since 2022 – as government aid contributions fell to 44% below their 10-year average, according to a new report from Goldman Sachs Private Wealth Management and its GS Donor Advised Philanthropy Fund for Wealth Management.

The 2026 “Philanthropy in Focus” report, based on a June 2026 survey of 569 Goldman Sachs private clients, family businesses, and family offices across the Americas and EMEA, found that 41% of respondents plan to increase their giving over the next three years. Among those who already give in excess of US$1.5 million annually, that figure rises to 48%, according to Goldman Sachs.

The findings arrive at a moment when financial advisors are under increasing pressure to integrate philanthropic planning into broader wealth strategies – particularly as an estimated US$124 trillion wealth transfer plays out through 2048, according to Cerulli Associates.

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Tax breaks not the driver

Despite common assumptions, only 12% of respondents cited charitable tax deductions as a reason for giving. The dominant motivations were values alignment (78%) and personal connection to a cause (51%), according to the report. Just 6% said tax deductions influence the size of their annual gift.

That finding has practical implications for advisors. Philanthropic conversations grounded in a client’s values and legacy – rather than tax efficiency alone – are more likely to resonate with the growing generation of ultra-wealthy donors now entering their peak giving years, the report suggests.

Carra Cote-Ackah, global head of Philanthropy Engagement and Legacy Planning at Goldman Sachs Family Office, wrote in the report’s introduction that the firm’s goal is to help clients make “more intentional, strategic, and impactful giving choices.”

Three forces reshaping the funding landscape

The Goldman Sachs report identifies three macro pressures that are simultaneously squeezing government capacity to fund public services and creating an opening for private philanthropy: unsustainable government debt, aging populations, and AI-driven labor market disruption.

On debt, the report notes that humanitarian aid contributions in 2026 are running 44% below the 10-year average, according to UN OCHA data cited in the report, while US funding for everyday charities has fallen approximately 38% since January 2025, per The Chronicle of Philanthropy. Military and defense spending is absorbing an increasing share of government budgets across Western economies, the report argues, leaving public good programs exposed.

Demographic pressure compounds the problem. Aging populations across G7 economies and China mean more retirees drawing state pensions and medical services, while a proportionally smaller working population generates less tax revenue to fund them. Goldman Sachs projects old-age dependency ratios will rise significantly across all major economies by 2050, based on OECD data.

AI presents a more ambiguous picture. Goldman Sachs Research cited in the report estimates generative AI could boost developed-market labor productivity by 15% over a decade – but that the same technology could substitute for approximately 25% of current work tasks in the near term, creating labor displacement costs that may add further pressure to public budgets before the productivity gains materialize.

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What advisors should take from this

The report’s most actionable section for wealth managers concerns what Goldman Sachs calls philanthropy’s “structural edge” over other sources of funding: the freedom to be agile, patient, and innovative in ways that governments and corporations typically cannot.

Notably, 45% of survey respondents said they had already adjusted their philanthropic strategy in response to recent geopolitical shifts – 30% by increasing their giving and 16% by changing the causes they support. That level of strategic responsiveness suggests clients are already thinking dynamically about their giving, with or without advisor input.

For advisors working with high-net-worth and ultra-high-net-worth clients, the wealth transfer angle is particularly significant. Research from Altrata cited in the Goldman Sachs report indicates that UHNW women – who may inherit as much as US$84 trillion of the broader transfer – approach giving as a partnership rather than a transaction, prioritizing affinity, shared values, and demonstrated impact.

The report recommends advisors encourage clients to think of their giving as a “charitable allocation portfolio” with short-, medium-, and long-term goals – structuring philanthropic intent with the same rigor applied to investment portfolios.

Donor-advised funds remain a central vehicle in that framework. The Goldman Sachs GS DAF reported that average grant size among its US clients grew from US$17,500 in 2016 to US$77,500 in 2025, reflecting both the scale of UHNW giving and clients’ increasing sophistication in deploying charitable assets.