As we continue with our Client Stories blog series, we share another segment from one of our young givers in our Novus Society, Grant Starrett. You can read last month’s feature from Mary Beth Weiss here.
When you meet Grant Starrett, you’ll likely have two experiences: you’ll get in a debate with him, and you’ll like him. Trained as a lawyer but spending his days in real-estate investing, Grant is a strategic thinker who epitomized the idea of having strong opinions, loosely held. His natural curiosity comes across in his constant reading on subjects across the spectrum (which he helpfully summarizes in a regular newsletter, which you can subscribe to at GrantReadsBooks.com). Grant joined the Novus Society, DonorsTrust’s giving program for young professionals under 40, several years ago as a way to continue to grow his thoughtful commitment to philanthropy. I always walk away from a conversation with Grant considering some idea in a new way. I hope you have the same experience in reading our discussion.
What do you think many young professionals misunderstand about philanthropy?
If you are pouring every cent you have into investments that you are confident will have a fantastic return, then it may be totally rational for you to hold off on giving because every dollar you give today could be ten tomorrow. But if along the way you’re upgrading your car, your home, or your lifestyle every few years, you could put a commensurate or even a disproportionate amount into philanthropy and get a far greater return in personal satisfaction.
It feels great to give to good causes, whether it’s saving puppies or Constitutions. At the same time, you have to ask yourself is whether you want to maximize your happiness in the bliss of ignorance, or whether your money is actually doing any good, specifically whether puppies or the Constitution are really being saved.
Happiness and effectiveness can coincide, however, if people stop giving their money away at the end of the year and instead divvy it up monthly or even weekly – this is one way a community foundation and donor-advised fund is really fantastic. By frequently giving, you can get a regular happiness boost while paying more attention to ensure that your favorite organizations are still doing what you think is worthwhile.
Otherwise, whether we are interested in happiness or effectiveness, we probably give too haphazardly and reactively.
Do you think a lot of people our age are held back by the idea that their dollars won’t be used effectively?
I suspect that young professionals have a bigger worry that they don’t have enough money to make a difference. But your question hits on the right note: we should be worried about effectiveness. By the very nature of philanthropy, practically the only thing ensuring effectiveness (or sacrificing it) is the discipline of donors.
Was there anything your parents or someone else did that clued you in to the importance of charitable giving?
I mostly give out of a passion for how things ought to be! I have very often been gobsmacked by how very wealthy and intelligent people give away money to causes that don’t necessarily align with their goals or principles.
My dad is a wonderful example of someone who has combined his passion for helping the poor with his business experience as a retailer to devote substantial time with Goodwill. Similarly, my mom has always been excited by the magic of reading. As a business executive, she was involved with her company’s philanthropic endeavors and got involved in building libraries for kids. Both my parents talked frequently about those causes growing up and how their passions translated into philanthropic efforts that not only involved financial support but also their time.
Incidentally, that is something I was struck by in Give Smart [the book sent to all new Novus Society members] where they told the anecdote about the guy who had given to 187 causes over the course of the year, yet when they asked how many he would give his time and energy to it was only five. The question is, what are you willing to concentrate on and give your time and energy to?
What attracted you to the Novus Society?
Initially, the matching dollars were great. But fundamentally in life, I want to see society better reflect my values, so I appreciate advice from people like you and the organization who know the space of people trying to advance my values.
Otherwise, I was already convinced of the model of the donor-advised fund both from a tax perspective and the idea of giving a little bit every month. And, as a devoted index investor, I appreciated the option to grow my giving through your Vanguard option.
Do you have a guiding aim for your philanthropy or are you still developing your strategy?
I am definitely still developing my strategy, but my aim is meritocracy. Generally the market does a great job of serving that purpose, but occasionally it falls short, and philanthropy generally has the potential to fill the space that the market leaves: so, for example, I am very interested in helping high achieving kids with low resources.
I am also very intrigued by the potential second-order effects of investing in cultural, political, and legal change, but pinning down the cause and effect can be very squirrelly. It’s a lot easier to calculate the dozens of people fed by a soup kitchen one night than how a community has been changed by economic seminars. And yet, in my view, the Chicago school of economics has done more to advance prosperity in the United States than any non-technological set of ideas. Or take the example of the Federalist Society, which has galvanized a generation of judges to revitalize the Constitution’s original public meaning.
Calling you an avid reader doesn’t seem to quite capture it. Have you read anything related to philanthropy or generosity that you’ve found valuable?
As a Christian, the Bible is the starting point for why to give.
How to give is a lot more complicated. Give Smart emphasizes how companies are kept on their toes by shareholders, customers, and competitors but charities lack a simple bottom line and so backers must impose their own standards. The Intelligent Donor’s Guide to Giving to Colleges by Anne D. Neal and Michael Poliakoff has wider applicability than its title suggests. They have a particularly good line that education is not about buildings but what goes on inside them. Neal and Poliakoff have very practical warnings about how money is fungible and that an administrator may deduct appropriations from your charitable destinations, leaving the programs with no net increase in funds.
I also strongly recommend investigating smart contrarian takes on whatever your favorite cause is. A perfect example is Bryan Caplan’s The Case Against Education, which argues that formal schooling even at its best doesn’t currently teach much useful but that the system instead signals to employers a candidate’s intelligence, conformity, and ability to complete assigned tasks. If true, how should your giving change?
