By Liz Behlke
It seems that every Sunday when I visit my Mom for dinner, she shows me a pile of envelopes from charities asking for money. She regularly sends modest checks to several groups, but they always seem to want more. I remind Mom that giving tends to trigger more asks, and she often complains about the waste of paper and postage from the solicitations she throws away. Mom’s giving tends to be reactive – responding to those who ask – we’ve talked about ways it could be more proactive and fulfilling.
One place to start is with the question: Why give? Not everyone has the same answer. My Mom might say she gives because someone asked, and because they seem to do good work. She also gives where she has a connection, like her university and the public radio station. (I don’t think she’s influenced by the endless supply of stickers and address labels that charities send, but she does have an impressive collection of note pads).
Reasons for charitable giving range from practical to personal. Tax deductions can be a motivator, but so can an experience like a family member with a chronic illness. And of course many people give where they go – to the arts, kids programs, and their house of worship. There’s no ‘right’ way to give; you should do what feels right for you.
Giving should make you feel good; you shouldn’t be doing it out of guilt or competitiveness. When choosing a charity, does it lift you up knowing what they could do with your dollars? Similarly, the amount you give should be based on what feels right – and gives you joy.
Until recently, a lot of my own charitable giving has been related to my daughter’s school and activities – theatre, robotics, and music. Now that my daughter is out of school, I’m starting to re-think my own giving plans. And I’ve learned a few things:
Focus on your values
If you give a little to a long list of charities, you may notice that, like my Mom, you’re always being asked for more. You can make a bigger impact if you just focus on a few charities and make more meaningful gifts. There are many organizations out there doing lots of good work, so it can be difficult to decide. Let your values and passions guide you. One person may choose to help animals or the local food bank, while someone else puts money behind disease research or education. Choosing your focus helps you make an impact – and gives you permission to toss a lot of solicitations into the recycle bin.
Do some research
Recently I was thinking about the need in our community for services to help unhoused people. I decided to do some research to figure out where a donation would make a difference and align with my values. I read how tiny house villages can provide secure shelter and a transition to permanent housing. I knew I wanted to give locally, so I did some online reading focusing on organizations that work in my community. Once I found a charity that fit, I found articles about them in the local paper and reviewed their website. After making my donation, they put me on their email list so I could keep up with their activities.
Legitimate charities will be transparent about their activities and expenditures. They have to follow rules that require them to make financial disclosures. You can get information directly from the charity, and on independent sites like Candid, Charity Watch, or Charity Navigator.
Magnify your giving
In my corporate job there was a little-known policy that allowed management employees to direct a certain amount of giving each year to a favorite charity. It was basically free money that would allow me to support any non-profit of my choosing. Many companies have programs like this. It helps them connect with the community in a way that’s meaningful to their employees. And it saves them the hassle of choosing among deserving local organizations. You can usually find information about matching or directed grants on your company’s benefits page.
Know before you give
Just because an organization is asking for your money doesn’t mean your donation is tax deductible. Many well-known groups engage in lobbying or political activity which means you wouldn’t be able to deduct your donation. Terminology can be confusing. A ‘tax-exempt’ organization doesn’t have to pay taxes, but may not be a 501(c)3. Only a ‘tax-deductible’ designation provides you with a potential benefit on your income tax return. If you’re unsure, ask to see the charity’s 501(c)3 letter from the IRS.
Give yourself some flexibility
You can greatly simplify your annual giving by doing it once a year. Define your goals, decide your budget, research organizations, then make your donations. But you might also want to set aside part of your giving budget for needs that pop up unexpectedly. This gives you the ability to respond to natural disasters or causes you just learned about. Just make sure you’re cautious about fraudulent requests for money that pop up around big world events. If you get an urgent ask from a charity you’ve never heard of, be sure to do your research – otherwise, stick with an established organization that may already have people on the ground in an impacted region.
Talk to your financial planner
Generous giving can make you feel great about sharing with others and supporting the community. It can also provide tax benefits and a lasting legacy. And you don’t just have to give cash. Your financial planner can show you strategies like donating stocks, setting up a donor-advised fund, or planned giving. They can also help you establish a budget that balances your objectives with your financial situation.
As for me, I’m still trying to encourage my Mom to shred most of the mail she gets from charities so she can focus on more significant contributions to groups that align with her values. I’m also trying to practice what I preach, allocating more substantial funds to a few charities so I can really support their good work.
As the year end approaches, your friends at Arrivity thank you for being a client and wish you and your family a safe, joy-filled holiday season.
If we can be of assistance with your financial planning needs, please contact us at 206.217.2583 or
Liz is a Late Boomer in the sandwich generation who started an independent writing and brand consulting practice after years as a senior marketing executive. She lives in Seattle, Washington. Her mother lives nearby and her daughter comes home during college breaks.
The foregoing content reflects the opinions of Liz Behlke and is subject to change at any time without notice. Content provided herein is for informational purposes only and should not be used or construed as investment advice or a recommendation regarding the purchase or sale of any security. There is no guarantee that the statements, opinions or forecasts provided herein will prove to be correct. Past performance may not be indicative of future results. Indices are not available for direct investment. Any investor who attempts to mimic the performance of an index would incur fees and expenses which would reduce returns Securities investing involves risk, including the potential for loss of principal. There is no assurance that any investment plan or strategy will be successful.