When Karen Pittelman took the lion's share of her $3 million-plus inheritance and started The Chahara Foundation, the 25-year-old self-described activist and poet (pictured above) took some heat from friends and family members.
"Most everyone thought I was some combination of crazy, communist, or naive," she says. "When I was younger, I wanted to wash my hands of all the money, pretend I had never even known it existed. That was guilt. But guilt is just inertia, just indulgence. It accomplishes nothing."
Her Boston-based foundation, now in its first granting cycle, will award renewable grants of up to $20,000 per year to Boston-based organizations working with, and run by, lower-income women.
Ms. Pittelman's decision to give away much of her inheritance was rooted in her desire to use that money toward a "radical redistribution of wealth.
"Turning my inheritance into this foundation was the way I claimed my responsibility [to this community]."
Pittelman is one of a small but growing number of young, cause-oriented Americans who have dedicated themselves and their substantial financial resources to supporting each other - and to challenging each other to act in accordance with their values.
Much of the effort of the emerging "cool rich kids" movement has revolved around donating significant portions of income and overall assets to smaller, grass-roots organizations and activist groups often overlooked by large foundations.
"For anybody who is both wealthy and socially concerned, there is some contradiction in our lives," says Tracy Hewat, director of the North Cambridge, Mass.-based Resource Generation, the nation's first and only nonprofit organization specifically devoted to working with and building an alliance of young "progressives" with wealth.
Questions surrounding the relationship between a global "wealth gap" and the financial circumstances of younger people with access to substantial wealth led Ms. Hewat to co-edit a resource manual, "Money Talks. So Can We." About 2,000 copies of the manual, designed for those under the age of 30, have been distributed worldwide.
Most of those who turn to Resource Generation for advice are, in fact, multimillionaires, says Hewat. But the organization turns no one away: Hewat recalls counseling a young person who felt overwhelmed by a $40,000 inheritance and wanted to give it away, and another person with $40 million in assets who wanted to make a positive impact with a portion of the money.
"People [initially] feel like they're making decisions in isolation," she says.
Hewat emphasizes that young philanthropists and social activists with wealth are by no means a new phenomenon, and that some of the nation's most respected progressive foundations were, in fact, started by young philanthropists in the 1960s and '70s.
"But today, because of the intergenerational transfer of wealth and because of the growth of the computer industry - and the age of the people who are typically [employed] in that industry - we are in an unusual moment," says Hewat.
How young people with wealth learn to relate to their inheritance or big paychecks is of paramount importance, agree those involved in the movement.
Billy Wimsatt, who first used the "cool rich kids" term in his book, "No More Prisons," explains that guilt and denial are often overriding and even paralyzing emotions among many young people with access to wealth. Mr. Wimsatt is co-director of Reciprocity, an organization focused on connecting young people across social and economic divides and making philanthropy "cool."
"Some of the best candidates for the cool-rich-kids movement have spent their entire lives pretending they're not [rich]," says Wimsatt, who gave away a third of his annual income last year to social-change philanthropy.
Young people who suddenly inherit wealth - or who cash in on stock options - are often at a particular loss to understand or cope with the influx of money, says Allen Hancock, publisher of a quarterly journal on wealth-related issues (See story, right). He adds that young people like himself who have come into wealth are often concerned about how their peers will view them.
"The running stereotype is that we're spoiled, petulant, greedy, unmotivated," says Hewat. "But that doesn't represent who we're talking to, and who's talking to us."
The complex relationship that young people with progressive values have with their wealth is one of several issues addressed at an annual "Making Money Make Change" conference for people 35 and under. Now in its third year, the conference will be held from Oct. 27-29 in Briarcliff, N.Y. Vivien Labaton, director of the New York-based organization, Third Wave, is helping to organize the conference.
"Young people who have a lot of money tend to be quiet about it because it sets them apart from other people," says Ms. Labaton. "It's easy to feel like you're just a part of the problem in the growing divide between the rich and poor. But when there's an opportunity to think about these things in a more productive way, it's a welcome relief."
Increasing the amount of dollars aimed at small, community-based nonprofits and toward addressing the root causes of poverty is to be a big emphasis of the conference.
According to a 1998 study by the National Network of Grantmakers, only 2.4 percent of foundation grants - or $336 million - went to "progressive," social-change philanthropy.
In contrast, a study last November by the Chronicle of Philanthropy found many leading charities, including the Salvation Army, YMCA, and the American Cancer Society, are bringing in billions, raising 16 percent more in contributions in 1998 than they did in 1997. The desire of the cool-rich-kids movement to change the distribution of some of these dollars is strong.
Hewat, too, was the benefactor of a large inheritance. Now in her early 30s, she gives away a larger percentage of her income every year, but remains realistic about the impact.
"Even if I gave all of my money away, it would not cure all the ills of the world," she says. "But my hope is ... that I can convince enough people to join me that [we] can have a significant impact, way beyond the money I can give - way beyond my own assets."
(c) Copyright 2000. The Christian Science Publishing Society