Money is tight and you are having a hard time balancing the books, so giving to charity should be out of the question, right? Wrong!
Charitable giving has always been strong in the US, as evidenced in the Giving USA 2015 report that says individual giving amounted to $358.51 billion in donations received by non-profit organizations. While certain economic factors have caused this number to fluctuate over the years, it doesn’t mean that the majority of individual givers are changing their minds about charity anytime soon, and neither should you. You might be surprised to learn that aside from giving back, you just might be the biggest beneficiary of your charity.
Charitable Giving: How Important Should It Be to You?
Giving to charity is important. Not only is it one way to give back to the community, it also allows you to use your money in an unselfish, altruistic away. Pledging to spend some of your savings on a charity makes you conscious about your spending and saving habits. Put differently, it forces you to spend according to your values, so you learn to spend money only on things that are important and of value to you or your loved ones.
Giving to charity also results in community improvement. For one, it helps fund schools and community centers. Jason A. Sugarman, a veteran in equity investments and regular donor to the Fullerton Technology Foundation, says that donations to educational charities is one of the best investments you can make, since you are ensuring children’s access to good education. Charitable giving encourages the flow of money and helps improve quality of life for those around you. Giving to charity creates a positive chain of events that benefits your entire community and indirectly benefits you and your loved ones as well.
Most importantly, leaving money for charity in your will makes you eligible for tax credits of up to 40% to 50%. This means that you minimize the taxes that your estate is liable for while supporting causes that are important to you long after you die. Leaving a part of your estate to charity can also reduce your inheritance tax liability. While this means that you are leaving loved ones with a smaller portion of your estate, you are shaving off a sizable amount from the inheritance tax and making tax obligations lighter in the process.
Entrepreneurs and Charity
There are many successful entrepreneurs who see the benefits of giving back. Mark Zuckerberg, Mark Cuban, and Sergey Brin are just three of many famous names who put charitable giving on top of their lists. Mark Zuckerberg and his wife regularly give to charity, and in 2013 donated $1 billion in stocks to the Silicon Valley Fund. Over the years, the couple has also been moving Facebook shares to other non-profits.
Sergey Brin, one of Google’s co-founders, gave his foundation $219 million in 2013. He also makes sizable contributions to the Michael J. Fox Foundation. Mark Cuban, businessman and owner of the Dallas Mavericks started the Fallen Patriot Fund in 2003. His brother runs the Mark Cuban Foundation which supports numerous charitable activities all throughout the United States.
Charitable giving benefits more than just poor communities and marginalized groups. It creates a flow of positive events that benefit not just the beneficiaries but the patrons as well. Whether you are an employee or an entrepreneur, giving back may just be one of the wisest investments you can make with your money today.