Each year as the holiday season approaches, our thoughts turn to charitable giving — and these holiday gifts play a large role in the sustainability of many, if not most, charitable organizations.
This year, our world seems particularly upside down with a war in Europe, Covid (and long-Covid) still lurking, and a possible recession looming. The nonprofit community is already seeing a drop in gifts from individuals. Thus, we encourage you, our clients and friends, to be more intentional with your giving this year.
Here are some practical tips for end-of-year giving.
Don’t give cash. Or maybe, give cash last. Consider your other assets before you give cash. There can be many tax advantages to giving other assets such as stocks, life insurance, your IRA, and even art objects. Talk to your financial advisor.
Don’t wait until the last minute. If you’re giving out of a Donor Advised Fund, or if you’re giving non-cash assets, don’t wait until mid or late December, as these gifts can take some time to process.
Don’t give over the phone. Despite what they might say, you never know who is on the other end. If you’re interested, have them send you something in the mail.
Talk to your family at Thanksgiving. If the family is together around the dinner table at Thanksgiving, charitable giving can be a wonderful topic for engaging all ages and teaching the next generation about the importance of giving back.
Here are a few more issues to ponder.
Don’t be too restrictive. Grocery prices are rising, and we’ve already seen a drop in small gifts to nonprofits.[1] Consider a general operating gift to your favorite nonprofits. If they ask you to donate to a specific program, ask them if a less restrictive gift might be more helpful.
Focus. You’ll have more impact and gain greater fulfilment if you focus on a specific issue, problem, or community.
Immediacy. There are several areas that have immediate needs. If you care about reproductive health, climate change, long-Covid, and libraries, organizations that deal with these issues can benefit from your help right now.
Donor Advised Funds. If you don’t know about DAFs, you should. DAFs can be a very powerful tool for charitable giving. Ask your local community foundation or your investment advisor about how a Donor Advised Fund can help make your charitable giving easy and more effective.
No obligatory giving! Resist the urge to give those obligatory gifts to organizations you don’t know or don’t care about. Instead, give to whatever moves your heart or inspires your head. To turn away requests from organizations or issues you don’t really care about, memorize a phrase such as, “I’m sorry, X is not a good fit with my present interests,” or “I am glad to have supported X in the past, but there are other issues or organizations that need my support more this year,” or “That was a one-time gift in support of my friend’s leadership.”
Final thoughts.
Start soon, be focused, and be a little more intentional. Your favorite organizations and causes need you more than ever this year.
Enjoy your holiday season.
[1] https://www.philanthropy.com/article/collapse-in-small-gifts-poses-threat-for-nonprofits-as-recession-looms-report-says