Knowing how much to spend on charity each year can be difficult. If you’re not in a religion that tells you hey, you have to give 10% if you want to be saved, making the decision of how much to spend on oneself, how much to spend on charity, and how much to save for our own future rainy days is not easy.
And then there’s the guilt whenever you look at worthy causes. Do I really need a year of lattes or to pay down my mortgage faster etc. if that means a kid doesn’t get mosquito netting and dies of malaria or another kid could go to private school or a cat’s life isn’t saved? (And, of course, who is more worthy? The kid in the developing country who could get malaria, the kid in the inner city who won’t get as good an education, or the fluffy kitty cat? And where does the ACLU fit in? How can we justify any spending at all?)
This XKCD comic does a great job of exploring that dilemma.
On a more serious note, it can be good to budget one’s charity. Choose a dollar amount or a percentage amount of income or some other target, just like any other portion of what you spend. Then plan your spending around that. Like the comic, you don’t want giving to be a chore and something that causes you deprivation… if that happens you might stop giving at all.
By planning charitable giving first, just like you plan savings first, you should be able to spend guilt free, because your spending choices are being made at the expense of other spending choices, not at the expense of giving.
In reality: I’m a soft touch… when people ask for good causes and good organizations I have a really hard time saying no, especially for things that hit education, kitties, or cancer. So I do a fair amount of unplanned charitable giving compared to the regular planned giving we do. But I’m also not as generous in terms of the amount I give as I thought I would be back before I started making a real income. Part of that is that we’re saving for future charitable giving (on DH’s relatives… turns out a Pell grant pays 100% of community college if you’re truly poor… I should update on that situation), but it’s still not as generous as I’d thought we would be at this income level. Lifestyle inflation does creep up on a person. And there are so many tax-advantaged savings vehicles we haven’t maxed out yet. Not to mention the fact that primary residences can be expensive. Maybe we will give more later, maybe we won’t.
Do you give? Do you plan charitable giving? How do you plan charitable giving?