Lest you think I’m some Scrooge-like miser, I donate to charities on an annual basis and write one cheque at the end of the year. I tend to give a flat amount (nothing based on a percentage of my income, as my income is very erratic), and I vary the amount based on how much I earned that year.
The more I earn, the more I give. But only if I can afford it, which as luck would have it, has been the case since I started working.
See, there are times when giving to charity (while commendable) is utterly, doggone stupid.
I’m not talking about being scammed out of your money and giving it to some fake charity that pays their board members $200,000 a year to sit around on their ass and do nothing.
I’m talking about people who cannot afford to donate to charities, but do it anyway.
Let me tell you a story: I know someone who is a very kind-hearted person. He is the nicest, most generous person you can imagine, and doesn’t seem to have a mean bone in his body.
He and his wife made $110,000 for the past couple of years (together) and didn’t save a penny of it for emergencies. They lived fairly comfortably but not extravagantly, had about $10,000 in credit card debt but the one thing that they made sure to do every month was give away $500 of their net cash to charities.
That’s $6000 a year, and they had $10,000 in debt.
To make matters worse, his wife lost her job, and now their income is down to $55,000 a year (just him). They can’t cover their bills — mortgage, 2 cars, 2 kids…. but the worst part of it all?
They are still giving away $250 a month to charities.
It’s totally commendable and an incredibly unselfish act beyond belief, but so totally asinine.
It is in their budget, and now they’re $45,000 in debt (they took out all of the equity on their home which was $30,000) and they racked up more on their consumer credit cards to the tune of $15,000.
When you can’t take care of your own family, to put food on the table, buy new winter boots because your kid can’t squeeze his feet into his 2-year old ones any longer, you don’t give money away.
For me, it’s the same principle of deciding whether to pay for your own retirement or your kids’ educations.
Ideally, you’d like to do both, but when push comes to shove, I’m taking care of my retirement first so I don’t have to burden my children or rely on them, and anything leftover will go to their education funds.
Granted, this couple I’m talking about were also pretty clueless in the past to not have saved at least $250 a month in an emergency fund for unexpected problems, but sometimes a budget needs to be revised when it comes down to your family eating and having a place to sleep, versus someone else’s.
Not only that, they had debt that they’ve just been paying the bare minimums on, just so they could give money away.
This might sound very mean and you might think I’m some cold, icy person to say that, but we can only help when we ourselves have been taken care of.
It does society and other families no good if you end up losing your home, going on unemployment, standing in line at food banks and unable to care for your own, especially if you are starting to rack up a lot of debt and you are STILL giving your net earnings away.
The general rule of thumb (which isn’t very accurate but is certainly compelling): $1 saved is $2 earned, because we have to factor in taxes, fees and other things that make our lovely gross income cut itself in half when it transitions into our bank account.
So in essence, they were giving away $1000 a month gross, and are now giving away $500 a month gross that they simply cannot afford.
In conclusion, I gently tried to point out the above, that if they lose their house and end up not being able to take care of their own family… that it would do those wonderful charities no good if they ended up on the other side, receiving help rather than being able to give it.
I think he got my point but I still feel like he feels and urge to give and that he can’t stop himself.
Just a girl trying to find a balance between being a Shopaholic and a Saver.
I cleared $60,000 in 18 months earning $65,000 gross/year.
Now I am self-employed, and you can read more about 
I have two experiences with this sort of situation…
1. I heard a story in Sunday school when I was young that touches on this. I don't know where it is in the Bible, and I do not practice any sort of religion in my adult life, but we remember the things we learn as children so here goes. Two men came to make offerings: a rich man and a poor man. The rich man gave a great deal of money, and the poor man only a few cents. The two men were judged for their offerings and the poor man was more highly regarded because while his offering was much smaller, it was nearly everything he had. The rich man gave a lot but it was only a small portion of his actual possessions. The point being it matters more how much of yourself you are giving, or quality over quantity. This is a great story to teach little kids about the gift of giving, but if I was living on the street and had two dollars to my name I probably wouldn't be donating it to other homeless people. I don't think. Maybe by then I'd be so desperate I'd just want to share.
I work at a bank. One of my regular customers is in her early thirties, single with three kids, trying to finish community college, working at the school to pay tuition, etc. She brought one of her sons to the bank once to cash a check and I heard her tell him that he needed to give a percentage of his money to tithe. I respected the mother for teaching this to her son, but looked at her bank balance and saw she only had a few dollars as well. I wondered if she had given a percentage of her salary as well and that was why she was out of money. Of course this is none of my business so I forgot about it until reading this post.
My point is, people have all different reasons for giving and I find it extremely respectable that these two individuals are trying, although possibly misguidedly, to give some of what they have earned. Based on their income it sounds like they could pay off their debt by adjusting other areas of their budget but if this is really not possible, then I agree with you FB that they should put that $500 per month towards debt until they can really afford to give.
I agree with you. It is respectable what they are doing, but for me, if they can’t take care of themselves and their family, how will they be able to give back and take care of other people in the future?
It sounds selfish but not really. You watch out for what you can give and for your life, so that you can continue to give, rather than end up as someone on the streets.
The problem isn't their giving, it's their spending in general. The fact they made $110K at one point but still had $10k in CC debt is the most depressing part of this article to me.
My recent post Humble Pie
Oh honey, they have more than $10k in debt still.
I do understand that not everyone is a PF nerd like us, but.. seriously!!!
This was such an interesting piece to come across! I actually work in a nonprofit legal agency, and so I have a lot of relationships with different directors and CEO's of the nonprofits. It's great for work but awful when I start getting hit up by all the nonprofits for their annual, 4th of July, Thanksgiving, membership and you name it, whatever else donation and giving periods. Considering that I get hit up so much and living on my first salary as a recent graduate, I'd be downright broke if I gave away to all the charities that requested it. I often felt bad not donating, but knew that I had to be realistic! It's so good to read someone else's opinion touching on being reasonable and sensible about charitable donations.
You are so welcome.
I absolutely agree with the heart and the thought that goes into giving away, but you have to be stable first, before you can donate.
Couldn't agree more. It's like the flight attendant says: secure your own oxygen mask before fumbling with your neighbor's.
My recent post Locks of Freedom- How to Ditch Your Shampoo Without Repulsing Your Friends
I know someone in terrible debt (w/ a big income too) who is always paying for the vet care of other people's animals….
Oh that drives me a bit crazy, but as long as they earn a lot.. I guess they can afford it?
Still, with terrible debt I don\’t see how that is even a priority.
I don't think they should be bankrupting or getting into debt for the sake of charitable giving. Since she's out of a job, why not just volunteer her time until they get back on their feet? It sounds to me like they're still in denial about their financial situation.
Great point. Time is something that a lot of these charities need a lot of. Or direction, if you have business and organizational skills.
It's kind of sad, actually–but that's the way our society works. We're taught from little up that we should put others before ourselves, no matter what. I can honestly say that, speaking from the "other side" of chairtable giving and the like, I give when I have it, but frankly, I have to look out for my family. And that comes down to looking out for myself–if I'm exhausted to the point that I might pass out halfway down the block, my dog doesn't get a walk in. Better for her to miss a day of work than to have her or her mother injured. The same goes for money–the point of chairty isn't to end up there yourself!
Sure, all those telethons urge you to "give, in case you should need to be given to in return". Guess what? Charity isn't supposd to be about trading favors! Giving to chairty is about being kind–it's not an obligation.
Oh, oops. I apologize for the rant. Maybe I should have just left it at "I agree"?
My recent post My Make-up
No, I love rants! 🙂 not just \”I agree\”. Hearing more examples and points of view makes me see things in a different perspective and learn something.
I also really don\’t like being guilted or pressured into it, so I avoid the subject.
I now have no regrets when I turn a charity down. I always have a place in my heart for charities, but I think there comes a point where one should say “I can’t” and not feel any remorse because they are looking out for their bottom line.
Exactly. I donate when I can, what I can, but not to put myself or my family in jeopardy.
I had World Vision come by my house last week and I told them straight out – "I can't. I'm a struggling student and unemployed." While she said "oh, that's okay." she was giving me the stink eye. Seriously. Why can't they just take the no? If I had the cash I would. Great post FB!
I think you make a great point FB. With the DH in school full time and me being the sole provider, we recently decided to pause our charitable checks. However, we are still giving back by volunteering for charity projects in our spare time (what little we have!). There are many homeless shelters or even pet shelters out there that can always do with a helping hand -even if you can't spare the cash! 🙂
My recent post The friends mugged abroad scam
It may not be the brightest idea, but I support their decision as long as they pay their bills. This may be their form of tithing. I think people who tithe believe that the money was never theirs in the first place, and it's not so much "giving it away" as it is "giving it to its rightful owner."
However, if their situation keeps getting worse and they go bankrupt, then I have an issue with it.
I agree with the sentiment, but they aren\’t making their bills if they\’re going deeper into debt because they\’re short $1000 – $1500 a month even without charitable giving. 🙁
When my grandma died she left a lot of money in her will to charities and barely anything left to her estate upon her death. Her brother's wife actually talked her in to this and my dad had to go to court to fight the will to take it off. I think some people have too big of hearts and think that others need the money more than them.
I think you have a good point – I struggled with not being able to tithe in college, but I was barely able to pay my rent and buy basic groceries. I tried to volunteer more time, instead, despite being very busy, and I think it worked out well for me. I would have felt worse if I failed to pay my rent, and I'm glad I didn't have any consumer debt on top of student loans. Maybe some people feel more strongly than I did, though.
I agree with your post, FB, if you can't afford to pay your own expenses, gaining debt is not going to help in the long run.
Your solution of offering time instead of money is a good one. I really agree with that, seeing as they are probably more short on volunteers than they are on donations or money.
I'm a bit tight for money at the moment, but I've been trying this micro-loan charity called Kiva. You donate some money to a small scale entrepreneur in the developing world, they use your investment to make a profit, and better their own situation and their community by proxy, and then they pay you back. So you can lend it again.
It's a really nice positive cycle.
If your friend is poor, but addicted to the good feelings that come from charitable giving, perhaps he could try that? He could donate the same money over and over, while still responsibly looking after his own.
Or maybe they could donate time at a soup kitchen, or other cause, rather than money?
I LOVE Kiva! Such a great idea. There's a larger-scale site called Prosper, which offers well-off people the chance to loan money to others in need to the tune of a few thousand dollars. Because you get paid back, these programs are perfect for investing in your community (or the world community!) without going broke yourself.
I heard about Prosper but it’s only in the states 🙁
I couldn’t agree with you more, especially with this statement:
“It does society and other families no good if you end up losing your home, going on unemployment, standing in line at food banks and unable to care for your own, especially if you are starting to rack up a lot of debt and you are STILL giving your net earnings away.”