Bill Gates donated $60 billion and it cost him over $350 billion in net worth — but donating can have financial benefits when you get the math right

When Gates gave away Microsoft stock, he also gave away any future gains. If he'd held onto that stock and kept his cash, he'd be four times richer today with an adjusted net worth of $464 billion instead of his current $108 billion, according to calculations made in March by Forbes.

That's a difference of $356 billion.

Similarly, Warren Buffet — who's donated more than half his Berkshire Hathaway stock — would move to the No. 3 spot from his current No. 9 ranking when considering his adjusted net worth.

Musk, on the other hand, remains the world's richest person even in these Forbes ‘Altruists’’ calculations. His net worth is estimated at $858 billion on this list — not much of a move from $839 billion on the main list. Musk has gotten some attention for transferring around $8.5 billion of Tesla stock to his charitable foundations, per Forbes, but "only an estimated $500 million, or 0.06% of Musk's vast fortune, has ever been disbursed to those in need.”

All of that said, making donations — whether massive or small — can have real financial benefits to donors, as well as the charities they fund. Here's how to do the math.

Benefits of donating stock

When you donate stock directly to a qualified charitable organization, you don't pay capital gains tax on the appreciation.

So long as that stock has appreciated for more than a year, "you are actually giving 20% more than if you sold the stock and then made a cash donation," according to Fidelity Charity (3).

While capital gains taxes vary depending on your overall income level, the federal rate for capital gains taxes on long-term holdings maxes out at 20%. Essentially, you give away more to charity, and it costs you less — so it's a win-win for everyone involved.

In addition, you can also claim a deduction on your income taxes for the fair market value of the stock you donated, according to the IRS (4).

If you've held the stock for less than a year, any gains will be taxed as ordinary income. Keep in mind that, in order to claim these deductions, you will have to itemize your taxes, rather than take the standard deduction. If you are taking the standard deduction, starting in 2026, you can take advantage of a universal charitable deduction of up to $1,000 (5) ($2,000 when married filing jointly).

Using donor-advised funds

Donating stocks may sound like a lot of work. After all, can the charity of your choice even accept stock as a donation?

That's where donor-advised funds (DAFs) (6) can help. A DAF is basically a charitable investment account, where you can make one donation to fund your account, then claim an immediate tax deduction while distributing donations to multiple charities over time.

This can help reduce your tax bill in a high-income year. But it can also help you donate stock without much effort on your part. While you can take a tax deduction for the current tax year, you can decide later which charities will receive your appreciated stock, as your money grows tax-free. This gives you time to think about the causes that are most important to you.