How much money to donate for charity? Jonah Engler explains the psychology behind it

May 21, 2020

Giving is a trait in most humans, which can later turn them into philanthropists depending on the individual’s perception of giving. Usually, charity begins at home because it is the easiest way to give. Often, people who have the right bend of mind about giving with a sincere desire to help others who are in need start by providing financial assistance to members within the family and derive pleasure from assisting others. As they practice giving, new realizations shape the way people donate for charity by choosing different causes that can aid the welfare and wellbeing of more people across society.  They start looking for issues and causes that are close to their heart and come forward to be associated with it by donating for charity and thus begins their journey in philanthropy, says Jonah Engler.

Giving for charity is a rewarding experience that fulfills the innate desire in people to do something good for society by providing financial assistance. They try to find issues they can connect with closely and regularly donate to meet their philanthropic goals. Living a life of fulfillment is a reason for people choosing philanthropy. Another reason which is perhaps more important is to make a difference in society for himself or herself and ensuring the way they would like to be remembered. 

For example, people today always recall the name of John Harvard, who bequeathed half of his estate in 1638 for establishing Harvard University. Similarly, people remember the name of Henry Ford as much for his contributions to the automobile industry, and his philanthropic endeavors through the Ford Foundation created in 1936 that works tirelessly for advancing human welfare.

Jonah Engler explains how to make a start

Expanding your philanthropic reach is not always easy because most people are not sure where to start by looking beyond the family.  Nowadays, numerous avenues of charity have multiplied with the spread of social, and it often leaves aspiring philanthropists somewhat confused.   From GoFundMe campaigns to Facebook fundraisers and many other options, it is hard to make out where to make a start in your philanthropic journey.

People in the lower-income bracket who have an intent for donations for charitable causes prefer to donate for causes that appeal to them instead of being regular donors for specific charities by setting aside a certain sum of money every year. Classy young people prefer to support any cause they stay directly involved in or encourage choosing a cause advocated by a friend or family member. They prefer to select charities that make it easy to donate and trust them with the money.

To sustain the habit of giving, it is essential to work closely on your financials so that at no point in time does it put your regular and committed financial liabilities like mortgage payments in danger.

Narrow down your options of giving

To narrow down your options, besides choosing the cause, you can also focus on how far your money will go. You should find out what your specific gift can do. How the charitable organization makes use of the money you donate will help you to visualize something real, like how many children they could feed with the money instead of trying to harp upon some abstract number. Regardless of what you decide, the most crucial step is to start giving because the habit that you start early in life will continue even in old age.  The urge to give and demonstrate it by beginning to give is what matters most, whether you earn five figures, six figures or more every year.

The time to give

Giving is a habit, and once you start it, you will continue with it for the rest of your life, even if the amounts are small. There is a huge similarity between charitable giving and saving for anything or like retirement saving because the amount you give is inconsequential to starting the habit of giving. You must plan when you can begin to giving by choosing organizations that you prefer to support.

Including charitable donations in your financial planning, every year is crucial regardless of the amount you donate. At the beginning of the year, set your spending goal towards charity and choose the charities you want to associate with and try to stick closely to the plan. In between, you might feel like giving to causes that pop up interims like flood relief or fighting wildfires or some other natural disaster fund. If you want to donate for some unlisted causes, set aside some money for spontaneous donation in your financial plan.

Stay within the limit.

Supporting your goals of giving with a financial plan will set the limits of spending for philanthropy and help avoid going overboard by trying to donate for every cause, which can stress your finances. Refrain from deviating from the plan, and any request for donations beyond it should be on the waiting list, which you can consider later by reassessing next year. Take all decisions about giving yearly, well in advance, and do not give yourself any room to make interim or monthly decisions about causes that keep propping up.

How much should you give

It is an accepted practice to earmark 10% of your earnings for charitable donations, a trend that originates from the practice of donating to churches. However, you can decide the amount according to your financial position, which can be anything from 5% onwards. People with low income tend to donate more depending on their understanding of how far the money will go and because they do not always calculate the percentage they donate. This is normal for people who do not have much money to keep aside for giving.

If you have a few hundred dollars left at the end of every month, you could decide to give the bulk of it.  However, donating comfortably should be the goal instead of allowing emotions to influence your decision that can strain your pockets.

 

 

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