There are a number of ways to express thanks, and one of them is giving back, which many of you are already doing. Here are a few ideas to help you with your efforts:
Charity as Beneficiary
This is an estate planning technique that will allow the charity of your choice to receive funds when you die. Here is how it works. Some accounts such as 401(k), IRA, life insurance policies and annuities, to name a few, have designated beneficiaries. This is the person(s) or organization(s) you specify to receive the money in the account when you die. You can divide funds however you like. For instance, you could name more than one charity or give a percent to a charity and the remainder to a family member. Be sure to consider this decision in the context of your overall estate plan, particularly the needs of your survivors.
End of Year Gifts
The holiday season can be a time for giving, but there is also end of year tax planning to consider. You can receive a tax deduction for qualified charitable gifts. The timing might make sense for you to give in this tax year, so be sure to cut a check before it’s too late. For more on the tax deductibility of certain gifts, check out this article by Nolo Press.
Make consistent giving part of your budget. Some people are formal about it with a tithe. Or you can come up with a percent or dollar amount that you want to give for each paycheck. This makes giving an ongoing priority and also breaks it down into manageable amounts.
Donor Advised Funds
These are accounts that you can contribute to now and give from later. You receive the tax deduction of the gift in this year. It can be a helpful planning tool, particularly if you have a large tax burden this year and future charitable wishes. Also, growth on the money in the account is not taxed. This Wall Street Journal article gives more background.
Time and Expertise
Additionally, you can give your time and expertise. Non-profits are almost always in need of volunteers. There are plenty of ways to serve even if you don’t have money to give. Take a look at Volunteer Match, who can connect you with an organization in your community or give you virtual opportunities to volunteer as well.
If you can’t give a large sum, don’t let that stop you. Giving a small amount can make a meaningful difference. The majority of funding for nonprofits often comes from small donors. You don’t have to cut a large check to help your favorite cause.
Additionally, if you’re struggling to create room in your budget to give, let SaveUp help you. SaveUp has a new way to help support great causes with their Holiday Charity Drawing. From now until December 17th, you can use your SaveUp credits to enter your the charity of your choice into a $2,500 drawing. Find out more at saveup.com/charity.
Wishing you a very happy Thanksgiving and prosperous holiday season so that you can give as well as SaveUp!
This post was written by SaveUp’s personal finance contributing writer, Catherine Hawley, CFP®.