Sarahritchie17 It’s that time of year again when pumpkin spice lattes are trending, the weather starts to get a little chillier, and we break out the sweaters and fall decor. But as the season changes, we also think about harvest and abundance and gratitude.
I am reminded of how blessed I am to have a roof over my head, a stable job to pay for rent and food, clean water, easy access to fresh produce, health, freedom, happiness, and love in my life. As I reflect on these things, I realize how privileged I am and that there are millions of people who do not have what I do. In fact, the World Health Organization (WHO) and UNICEF found that in 2017, there were over 785 million people without access to clean water.
But the point of this post is not to guilt you into donating to a charity. The point is to talk about the importance of charitable giving as a personal finance habit and let you in on my process of deciding who to support.
Why Giving Back is Important
1. To live in a mindset of abundance
Aside from the obvious reasons of doing your part and making the world a better place, giving back reminds you to be grateful for the blessings in your life. I’ve previously written about the importance of having a gratitude practice, and each Thanksgiving I write about things I’m thankful for. Gratitude and thanking God for all I have is so important to me.
When you do research about what charities are out there, it opens your eyes to a lot of issues in the world and really makes you appreciate the simple things that you take for granted. When you embrace a mindset of abundance, you become inherently happier with the life you have and where you are. From this mindset, you can stop the cycle of needing more, and you recognize that the things you have and who you are is enough.
2. To build the financial habit
I know it seems counterintuitive that giving away your money could be a good thing in personal finance, but believe it or not, I think it is. First, it encourages you to live with less. If you can incorporate charitable giving into your budget, then you can probably also incorporate investing in yourself and saving for your future. Do you have $2 per month to spare? That’s all you need to get started.
Second, it’s so easy to say that you’ll start donating to charity when you get a raise or next year or next time you’re asked by the Salvation Army. The problem is, all of these are in the future and indefinite. You don’t know when you’ll start making more money, and by then, you may have forgotten about your commitment to donate some of that extra money. I always think of the lyric in the Rascal Flatts’ song How They Remember You, “When you’re down to your last dollar, will you give or will you take?” The sooner in life that you start the habit of giving, the easier it is.
I listened to a podcast that explained this concept really well: The Goal Digger Podcast Episode 444: 5 Steps to Shed Toxic Money Mindset Patterns.
“Money is a means to make a difference and even if that difference is small, it’s not insignificant. Money really is a gift. If you aren’t in the practice of giving now, that likely won’t change when your finances change. I remember a line that someone had said when they said, if you can’t give $10 from $100 you earned, you sure as heck won’t be able to part with $10,000 when you hit six-figures.”
Jenna Kutcher – The Goal Digger Podcast Episode 444: 5 Steps to Shed Toxic Money Mindset Patterns.
You can find the full podcast on Spotify here and the shownotes here.
3. To give back to the causes that supported you
When I think about how I got to where I am today, I know it took a village. It took the support of my family and friends, but it also took the lessons I learned from swimming and Girl Scouts and my education. To me, it’s important to pass it on and give to the generations that come behind me.
The Process
It can be overwhelming to think about where to give your hard-earned money away. There are lots of issues in the world and lots of groups working towards solving those problems.
You can wait until someone is standing outside your local grocery store asking for your donation, or you can do some quick research and donate with intention to organizations that resonate with you the most.
Before I even start my research, I think about things that have personally affected me or people I care about. When you support these kinds of organizations, you directly understand the impact they’re having.
When I research charities, there are a few things I consider before I donate. I like to know what exact initiatives my money is going towards and what percentage is going towards administrative costs and fundraising. I like to check the official website of the charity as well as Charity Navigator to get the full picture.
Once I feel confident that my money will serve the need I want to support, I decide how much I can and want to give. I look at my budget and see where there’s excess or where I can adjust to have money to give.
I choose to do monthly contributions which is a nice option since just $10 a month adds up to $120 per year. (That’s just an example; not the amount I actually give.) If that feels like a lot, here’s some other ways to think about it.
If I can spend $5 on a latte once a week, I can spend $20 a month to help supply water to someone in need.
Could you give $1 each day or the pay you’d get for one hour of work out of each week?
The last step in the process is obviously to make the donation.
Learn more about how I donate through the Combined Federal Campaign (CFC) and the causes I currently support here: 7 Causes I’m Supporting in 2021 and 2022
References and Further Reading
- https://www.cdc.gov/healthywater/global/wash_statistics.html
- 10 Things I’m Thankful For – 2020
- 10 Things I’m Thankful For – 2019
- The Goal Digger Podcast Episode 444: 5 Steps to Shed Toxic Money Mindset Patterns
- Charity Navigator – https://www.charitynavigator.org/index.cfm
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Cheers!
Sarah
[…] week, I wrote about the importance of charitable giving (aside from the obvious) and my process for deciding where to donate. Today, I want to go more into […]