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A Guide to Meaningful Charitable Giving

Updated: Nov 30, 2023

If your family is similar to mine, you might do the lion’s share of your charitable giving in December. We like to include our kids (correction, our young adult children!) in the conversation, as we believe it’s important to model generosity from the home.


Beyond the societal benefits of generosity, research consistently demonstrates a profound link between generosity and happiness. When we unravel the ways in which acts of kindness create a positive ripple effect around us, we discover that generosity can not only benefit the recipient but it can also foster a deep sense of fulfillment, thankfulness and joy in the giver. This phenomenon challenges the conventional notion that happiness is solely a result of personal gain. Instead, it suggests that true joy is found in the act of giving itself.



Cultivating a Generous Mindset

Cultivating generosity goes beyond sporadic acts of kindness; it involves adopting a generous mindset as a way of life. This mindset is characterized by a willingness to share resources, time, and compassion with others. By consciously incorporating generosity into our daily lives, we not only contribute to the well-being of those around us but also lay the foundation for our own enduring happiness.


The practice of generosity reminds us of our shared humanity and the intrinsic joy that comes from uplifting others. As we embrace a generous mindset, we embark on a journey towards a more fulfilling and happy life—one where the effects of our actions extend far beyond our immediate circle, shaping a more compassionate and interconnected world.


When Helping Hurts

With that being said, there are numerous studies that show how outside assistance can sometimes have unintended and detrimental consequences. When we dive a little deeper into the complexities surrounding the act of helping others, we often discover that it can lead to unforeseen harm.


General Principles for Charitable Giving

With this context in mind, I would like to share a few general principles to consider as you think about your year-end charitable giving:

- Never do for others what they have the capacity to do for themselves.

- Limit one-way giving to crises and seek always to find ways for legitimate exchange.

- Seek ways to empower by hiring, lending, and investing and offer gifts as incentives to

celebrate achievements.

- Set aside your own agenda and put the interests of others above your own

Adapted from the Lupton Center (https://www.luptoncenter.org/oath-for-helpers/)


Standards for a Healthy Organization

When considering which specific organizations you would like to support, look for organizations that are not only aware of their potential to harm when providing help, look for organizations that live up to the following standards:

- Evidence of effectiveness. Seek out organizations that implement programs that have

generated real-world results and not results found in academic studies of programs.

- Cost-effectiveness. Consider data points such as the total "cost per life saved" or "cost

per person saved from the sex trafficking industry.”

- Total economic benefit to others. Seek out charities running programs that perform

well on metrics like this. Low-income people in the developing world have

dramatically lower standards of living than low-income people in the U.S., so if your

desire is to eliminate poverty, your giving dollars may have a greater impact with

organizations that serve poorer nations.

- Transparency. Examine potential giving opportunities critically and thoroughly. Well-run

organizations will be open to extensive investigation and discussion of their track record

and progress, because they have nothing to hide. This includes financial transparency that

shows all the revenue and expenses incurred by the organization.



Warning Signs

In addition to the four marks above, also be aware of warning signs:

  • Excessive salary expenses for the senior management team

  • Financial instability

  • Recent changes in leadership or strategy

  • Instances where the organization discovers dishonest activities from its staff or associates, and does not take swift, comprehensive corrective action

Conclusion

Good decision-making also involves intuition and judgment calls. Be open to prayer and seeking counsel from others. Psalm 32:8 says “I will instruct you and teach you in the way you should go; I will counsel you with my eye upon you” and Proverbs 3:5-6 tells us to “Trust in the Lord with all your heart, and lean not on your own understanding. In all your ways acknowledge him, and he will make your paths straight.”


As we move into year-end and we get busy with the “busyness” of December, my hope for you is that you will experience the joy of being generous this holiday season.





This article is a general communication being provided for informational and educational purposes only and is not meant to be taken as tax advice, investment advice or a recommendation for any specific investment product or strategy. The information contained herein does not take your financial situation, investment objective or risk tolerance into consideration. Readers, including professionals, should under no circumstances rely upon this information as a substitute for their own research or for obtaining specific legal, accounting or tax advice from their own counsel. Any examples are hypothetical and for illustration purposes only. All investments involve risk and can lose value, the market value and income from investments may fluctuate in amounts greater than the market. All information discussed herein is current only as of the date of publication and is subject to change at any time without notice. Forecasts may not be realized due to a multitude of factors, including but not limited to, changes in economic conditions, corporate profitability, geopolitical conditions, inflation or US tax policy. This material has been obtained from sources believed to be reliable, but its accuracy, completeness and interpretation cannot be guaranteed.

LEGAL, INVESTMENT, AND TAX NOTICE. This information is not intended to be and should not be treated as legal, investment, accounting or tax advice.


PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS.


Copyright 2023. Monotelo Advisors Inc. All Rights Reserved

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