Charitable giving can be a meaningful way to create positive change in your community and beyond, but approaching it without direction can leave you feeling overwhelmed or questioning your impact. Thoughtful planning can help donors align their generosity with their core values and financial situation. By implementing a few strategic practices, your charitable contributions can have the potential to make a meaningful difference for the causes you care about most.
Here are 5 practical approaches to consider as you plan your charitable giving journey.
Align your money with your values.
1. Give to Charities Earlier in the Year
For many years I ran nonprofit organizations and part of our budget depended on charitable donations. Having much of it come in at the 11th hour at the end of our fiscal year was stressful!
Timing matters when it comes to charitable contributions. Many donors wait until the end of the year to make gifts, but giving earlier can allow your dollars to start working sooner. Nonprofits can potentially use your support to plan their budgets, launch programs, or respond to urgent needs.
Giving earlier can help you avoid the year-end rush to meet tax deadlines, which can lead to a more thoughtful approach to your donations. Giving earlier or spreading your giving throughout the year may also reduce the stress of making last-minute decisions and can evaluate how your contributions are being utilized.
2. Develop a Philanthropic Plan That Reflects Your Values
It is common to get overwhelmed by the wealth of giving opportunities out there. Where do you start? How do you use your limited giving budget to create the change most meaningful to you?
A well-crafted philanthropic plan can help to align your giving with your core values and long-term goals. Start by identifying the causes and issues that matter most to you. I often suggest picking one or two themes that you personally believe are the most important things to change in the world. Whether it’s education, healthcare, environmental sustainability, or social justice, narrowing your focus allows you to create a meaningful impact in areas that resonate deeply with you. That does not mean the other causes are not important – it just means you have decided to focus on a couple of themes in order to feel effective as a donor.
Your philanthropic plan should also consider:
- Budgeting: Determine how much you’re comfortable allocating to charitable giving each year. As a financial advisor, I typically create a charitable giving line item in my clients’ financial plan to help them reach their giving goal. Having a budget helps you make sure you are giving enough and also helps you say “no” when you’ve reached your maximum giving for the year.
- Tax Benefits: Work with your financial advisor to understand how to maximize deductions and leverage tools like donor-advised funds and other tax-efficient giving strategies. Because who doesn’t want to give away more and pay less taxes? If you are writing checks to charities, you might be giving less away to good causes and paying more taxes than you need to!
- Legacy Goals: Consider how your giving today ties into the legacy you want to leave for future generations.
At Abacus, we have a fun exercise that helps clients identify the themes that speak to them most. Being clear about what matters to you can help you align your charitable giving with those themes. Your giving becomes intentional and proactive, empowering you to make decisions that feel both purposeful and rewarding.
3. Use Your Plan to Say “No” with Confidence
One of the challenges of being a generous donor is managing the influx of requests from charities. While it’s wonderful to be seen as someone who wants to help, it’s equally important to stay true to your plan. The plan allows you to be more proactive rather than reactive (and give to the same charities you’ve always supported more out of habit than clear intention).
When you receive requests from organizations that aren’t part of the themes you’ve identified, having a clear philanthropic strategy makes it easier to decline politely. For example, you might say, “Thank you for reaching out, but I’ve planned out my giving for the year and am focused on supporting education and clean water initiatives.” This approach helps you stay focused while still being respectful of the requesting organization.
4. Evaluate Charities Before You Give
Not all charities operate with the same level of transparency, efficiency, or impact. Before making a donation, research the organization to ensure your money will be used effectively. Start by:
- Checking Ratings: Use platforms like Charity Navigator, GuideStar, or the BBB Wise Giving Alliance to review the charity’s financial health, accountability, and impact.
- Reviewing Financials: Look for transparency in how funds are allocated. And, as a former Executive Director of a nonprofit, beware of thinking that 90+% of an organization’s dollars should go to programming or they’re not doing a good job. They need to attract and pay effective staff too! Look at the effectiveness of their programs as well as how they spend their funds.
- Reading Reviews: Learn from other donors and beneficiaries about their experiences with the organization.
Taking these steps helps to identify if your contributions are going to organizations that align with your values and are making a meaningful impact.
5. Engage with Charities After You Give
Once you’ve made a donation, maintaining a relationship with the charity can be rewarding and insightful. Here’s how to stay involved:
- Stay Informed: Sign up for newsletters or follow the organization on social media to keep up with their work and progress.
- Tell Them What You Want: If you are giving a generous donation, please feel free to tell them you do not want them to send you lots of mail and free calendars. What would be helpful to you? Some donors ask for a report on who was helped by the organization and the impact they’ve made.
- Provide Feedback: Share your thoughts on how the organization communicates its impact and programs. Constructive feedback can help them improve.
- Volunteer: If possible, consider donating your time and skills in addition to financial support. Being personally involved can help you feel an extra connection to what your dollars are doing in the world.
- Celebrate Successes: Acknowledge milestones and achievements the charity shares. This strengthens your connection and shows your ongoing support.
Building a relationship with the charities you support fosters trust and gives you greater insight into how your contributions are making a difference.
The Meaningful Impact of Strategic Philanthropy
One of my favorite things to work on with clients is their charitable giving plan. When you approach charitable giving with intention, you become part of something greater than yourself. Moving the needle on the dial of the challenges you see in the world can feel empowering, and realizing that you can be a part of that change is magical. Really, anyone can be a philanthropist – you just need a plan!
A well-considered philanthropic plan can help you maximize your impact while aligning with your values and financial circumstances. It can help transform occasional donations into a meaningful practice that connects you to the causes you support and the communities they serve. Whether your contributions are large or small, strategic giving can help you to leave your unique imprint on the world—one thoughtful donation at a time.
