For those with the means to make year-end giving a part of their annual (or even occasional) financial routine, donating to charitable organizations can not only provide much-needed help for the causes they contribute to — it can also create substantial personal benefits for the donors themselves.
One of these benefits, of course, is that it feels good to support a charitable cause, knowing that your donations are making a difference in the lives of others and serving to uplift the community. And from the standpoint of your personal finances, if you itemize deductions on your tax returns, contributing to qualified charitable organizations can also help lower your tax burden.
8 ways to maximize your charitable donations
Looking to make the biggest possible impact with your charitable giving? Consider these eight tips that can help ensure a strategic approach to your plans for making charitable donations — while helping deliver the biggest possible impact for the causes you care about:
- Choose a fund-giving fit — When it comes to selecting a charitable organization to support, there is an extremely long list of options to choose from covering a broad range of missions. When deciding where to donate your funds, give some serious thought to which causes mean the most to you, then focus on organizations that are a match for your strongest passions and beliefs. Once you’ve identified a few candidates, do some research to determine each one’s current needs and past impacts to ensure that your donation will be put to good use and is supporting an effective organization. One resource that could be particularly helpful in this area is Charity Navigator, a website designed to help people find charities that align with their beliefs, then research their ratings.
- Expand your impact — You don’t have to limit yourself to supporting a single charity. If you’re passionate about multiple causes, consider splitting your contributions between different charities that align with your most heartfelt beliefs. Further, if you don’t have the available funds to make monetary donations to all the organizations you’d like to support, most charities are always looking for people willing to volunteer their time and skills to support the cause — and volunteering is a great way to deliver big impacts for the organization while giving you a chance to better acquaint yourself with the organization and the people behind it.
- Consider consolidation — While giving smaller amounts to your favorite cause(s) each year is sure to be a big help, you might want to consider setting aside the funds you plan to donate each year in a savings account, then donating larger amount(s) every couple or few years. In addition to providing a larger and potentially more impactful sum of money to the organization(s) you support, this can help you maximize year-end contributions — and reach the giving amount at which you could lower your tax burden by going the itemized-deduction route (as opposed to the standard-deduction route) when you file your taxes.
- Don’t miss out on the match — As a part of their benefits packages, many employers offer their workers gift-matching programs in which they’ll match employees’ qualifying charitable contributions up to a certain amount each year. Such programs can help employees compound the funds they contribute to their favorite charitable organization(s). They can also enable employers to support worthy causes in the community while strengthening employee-employer bonds and providing an added incentive for a prospective employee to choose to work for the company. Before making your charitable contribution(s), check to see if your employer offers this benefit so that you don’t leave any potential funds for donation on the table.
- Build a budget for your giving — If you’d like to ensure that you have the funds available to consistently support your favorite cause(s), consider working charitable contributions into your household budget. No matter how large or small your donations may be, by factoring them into your budget, you’ll be able to ensure you make them regularly — and over time they can really add up.
- Consider periodic payments — By making monthly, bi-monthly or quarterly donations to your charitable organization(s) of choice, you can soften the impact of the expenditures on your pocketbook by spreading the contributions out over time rather than making one lump-sum payment. And in addition to being easier on your budget, these throughout-the-year contributions can help ensure a strong monthly cash flow for the organization(s) you support — which can increase its/their chances of long-term sustainability and success. Further, if your bank of choice offers an online banking service, you can reduce the chances you’ll forget to make your periodic donations by using the convenient service to set up a recurring payment to your charitable organization(s) of choice.
- Build a giving foundation for your family — If you believe strongly in charitable giving and want to teach your family members (and especially your children) about its importance, invite them to join you in your plans to donate — and when you volunteer, ask them to join in those efforts, too. (If they support causes that differ from your top choices, consider letting them pick their own charitable organizations to support.) No matter how large or small their contributions may be, having your family members participate in philanthropic efforts will help lay the foundation for a future giving spirit and future charitable acts.
- Think about leaving a legacy — If you’d like to leave behind a legacy of giving that continues even after you’ve passed away, consider including charitable contributions to your favorite nonprofit organization(s) in your will. This way, during the estate settlement process, those handling the distribution of your financial assets and other belongings after your passing will know to provide the amount(s) you choose to the organization(s) you’ve decided to support — and your giving spirit can live on to keep doing good for the causes you believe in the most.
Proudly serving South Carolina since 1933, Arthur State Bank offers accounts and services to meet a variety of financial needs. To help you achieve all your financial goals, the bank offers in-person service as well as a range of convenient digital solutions. To learn how Arthur State Bank can help you with banking needs ranging from checking and savings to retirement accounts, mortgages, other personal loans and more, visit arthurstatebank.com.