Do you make room for giving in your monthly spending?
I asked this question on my social media accounts this week and I was amazed with the amount of positive responses. Some families donate by volunteering their time, some donate physical products to local organizations, some donate money and some do a little bit of everything.
Giving back is a selfless act and I can promise you, it’s way easier to incorporate giving into your finances than you might think. At the end of the day, you’re helping others who need it. That’s powerful.
Someone replied to me and said “Charitable giving would be investing into yourself, your healing, your internal peace and then you radiate a healing glow that transforms anyone that comes in contact with you. It’s stronger than the strongest manmade bomb… inside out.”
I think we can all agree that this year has been one for the books. From the Australia bush fires to the coronavirus pandemic to the Black Lives Matter movement, 2020 has shown us we need to stand together, open our hearts and we need change. If you’re able to donate money or even if you think you can’t, take a look at these different ways to incorporate giving into your finances and you might just find one that works for you.
An easy way to start donating regularly is to calculate a percentage of your income. This is how I incorporate giving into my finances. My current charitable givings are just over 1% of my after-tax salary but some families are able to donate 4%, 7%, even 10% of their annual income.
You can choose to donate to different organizations each paycheque, maybe each month, or you can set up a regular contribution if you resonate strongly with one organization in particular. Automating your givings can also be helpful if you think you might forget. Schedule your charitable givings like it is a bill, add it in as a savings goal category or place is as a fixed expense in your budget.
Do you spend every single dollar you make every month or is there sometimes something leftover?
I personally end up with at least a few dollars leftover every month. While I usually transfer this amount into my slush fund in a high interest savings account, you could choose to donate all or a portion of the leftover money you have left at the end of each month.
Let’s say my friend Sue wants to donate up to a maximum of $50 each month and wants to start by using their monthly leftovers. In April, Sue had $80 leftover, so they donated the full $50 and transferred the rest into their savings account. In May, Sue had $15 leftover, so they simply donated the $15 that was leftover.
Pick something you buy somewhat regularly, and whenever you buy that, donate the same amount you spent. This one takes a lot of self motivation and accountability.
Let’s say my friend Jack likes to treat themselves and go out to the movies from time to time. Each trip to the movies costs about $30 including the ticket, the popcorn and other snacks. Jack now chooses to donate $30 every time they go to the movies!
If you want to donate just a few dollars whenever you buy a coffee to-go or maybe a fancy smoothie from your local juice bar, every little bit helps. Whatever is going to work for you to help incorporate giving into your finances!
You could literally round up your spare change in a piggy bank type jar and donate that amount after taking it into the bank. But if that sounds like too much work and let’s be honest, who actually uses cash anymore? So to answer to your question, yes. Yes, there is an app for that. It’s called Mylo! Here’s how it works:
Create an account and link your bank up to the app
Select a Canadian charity
Use your debit and credit cards to make purchases
Mylo rounds up your purchases to the next dollar and donates your spare change
Every week on Monday, Mylo will automatically withdraw the round up funds from your bank account so you can set it and forget it. So let’s say you buy a coffee for $2.50 on your credit card. Mylo will round up that purchase to the nearest dollar, which would be $3.00, and withdraw $0.50 from your account that week.
I have round up set up for my Wealthsimple investments and my spare change usually comes out to about $5 per month. I can promise you, I don’t notice it coming out of my account. Mylo has over 86,000 registered Canadian charities and makes it easy to help support a cause that matters to you.
Final Thoughts
Always read the about page or description and make sure you know where the money is going before you donate to an organization. You can also check out their social media platforms and do some research about their efforts there.
Once you’ve found a charity to support, you should check to see if your company has a donation match program to easily double your impact when making charitable donations.
Finally, don’t forget to keep your receipts for tax time as you can get a tax deduction for your contributions to registered charities in your country. Unfortunately, a lot of advocacy organizations won’t be registered charities and will not have an official tax receipt. While a tax deduction is a bonus to donating money, remember what’s important to you and stay true to that.
“No one has ever become poor from giving.”
Disclaimer: I am not a certified financial planner or investment advisor. The ideas posted on this website are my own opinions on how I manage my personal finances. The content is specifically for educational and informational purposes and is not considered professional financial advice. Everyone’s finances work differently and you will have to do your own due diligence before making any financial decisions.
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