How to Get Started in Giving

A friend recently asked me how he and his wife could find a good charity to start funding.  It’s a good question and not one that’s easily answered.  Maybe it’s helpful to think of starting a giving program like starting an exercise program.  Both of them:

  • help you feel better about yourself
  • require commitment and effort
  • can be fun, but can also be painful
  • are things you “should” do for a well-rounded life

So how would you start an exercise program?  Well, I would look for friends who enjoy their exercise programs and imagine if I would like them too.  I am personally not a big outdoors person, so that eliminates a lot of options.  And I don’t like sweating or getting off the couch, so I guess I’m limited to squeezing hand grips while watching action shows.  But to focus on the positive, I do like sprinting and hitting things with sticks, so racquet sports usually work well for me.  The lesson for giving is that you can eliminate some broad areas but also find some things you care deeply about.  There are many types people in the world who are disadvantaged or subject to injustice.  Some questions to help narrow it down:

  • Do you care more about the local community, the country as a whole, or international issues?  International poverty is on a different scale than domestic, meaning they can be much poorer.  But because of the distance, they are also harder to reach effectively and work with directly.  Or maybe the possibility of traveling there is a plus for you?
  • Are there certain groups you feel for?  Children, homeless, immigrants, women, teenage moms, elderly, cancer patients, starving artists?  I’ve found that being a new parent opens my eyes to the benefits my child has, compared to many other children who live just a few miles away.  So it makes me more open to helping other kids, for example reading in classrooms.
  • How much interaction do you want?  Do you like other kids, but only at arms length (or farther)?  Or do you want to see gap-toothed smiles as you teach and play with them?  There’s a wide range of interaction from none (just writing checks) to regular meetings like being a Big Brother / Big Sister.

One aspect of giving I don’t like is that many charities will sell the names and addresses of their donors, which increases your junk mail.  To avoid this, you can give through a Charitable Gift Fund (CGF) which hides your address.  As an added bonus, it also helps simplify your taxes since you take a deduction when you put money in CGF, not when you disburse the fund’s money to individual charities.

Finally, I’ll list a few concrete suggestions:

Loans and Investments: by putting your money in these places, you are loaning rather than donating it.

  • Kiva: you make no interest, but can invest small amounts in individuals starting businesses
  • Microplace: you make a small amount of interest and can invest in larger amounts than Kiva.  Less hands-on interaction.
  • Prosper and LendingClub: rather than put money into a savings account earning 1% interest, you can loan at higher interest to fellow Americans who need loans.

Direct Donation: here are three places we featured on this blog for the Advent Challenge this past Christmas.

And one bonus: My New Red Shoes helps local Bay Area homeless families by providing shoes, clothes, and school supplies, packaged in bags that you sew yourself.  Crafty…

I hope this helps, and I’d be glad to answer any questions.  Happy giving!

3 thoughts on “How to Get Started in Giving

  1. Ooh, great post, Ed! Thanks for providing these straightforward steps to those interested in getting started.

    A few notes of my own:
    1) I 100% agree with what you wrote about there being diverse communities to whom you can give. Two other target communities, in addition to the ones Ed suggested, that we may sometimes forget about (by virtue of not encountering them very often in our daily lives) are as follows: brothers and sisters who have disabilities (e.g. those who are blind/deaf or confined to a wheelchair) and those who are in prison, the latter of which are for the most part completely segregated from the rest of society.

    If anyone would like suggestions for either types of these organizations, please let me know as I’d be happy to share.

    2) Something else worth considering as we launch our giving–at least, something that I’ve found I get really excited about–is how much of a return on investment from an impact standpoint are we hoping to have? For example, my $1 may provide life-saving micronutrients (e.g. salt) or a vaccine for a malnourished child in a developing country this year, but it might not go as far in, for example, the United States for a homeless person who has been vaccinated and has food stamps but is looking for housing. Not to say we shouldn’t give domestically–because we’re not utilitarians–but that that may be something we may want to consider as well.

  2. One thing that is also important when you give is to concentrate your giving as much as possible. You are doing less by giving $5 to 20 organizations than you can do giving $100 to one organization. There is an overhead cost of processing funds as well as CRM and follow up costs. In fact, a $5 donation will often cost an organization money. Considered giving to one or two organizations will also help you to be a more educated and involved donor for those causes.

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