In our recent discussion about tithing, I made a confession:
I do not tithe to church or charity. I feel guilty about this. My rationale is always: “Once I take care of myself, I'll take care of other people.” Yet what do I mean by “taking care of myself”? I don't know. Sometimes I think “once I've saved X, then I'll start sharing my wealth”, but X seems to be a moving target.
I've thought a lot about this over the past couple weeks. I've looked at my own life: I have a $10,000 emergency fund, a growing business, and no consumer debt. I own an 1800-square-foot home on half an acre, a car, and a pantry stocked with food. Despite all this, I still sometimes feel poor. I'm not. I know this. According to the Global Rich List, my wealth places me in the top 1% of the world population, and that will likely increase as I get older.
I have enough. I'm ready to share. But how?
Learning to give
I've written many times how important it is to start saving for the future, no matter how much you set aside. If you can only afford to save $5 a month, then start with $5. If you can afford $50 a month, start with $50. The key is to develop the habit. In time, most people find they can bump their saving rate higher — $10, $20, $200.
In our recent conversation about tithing, Kathleen M. urged me to consider using this same technique to develop the habit of giving:
If you do want to start giving regularly, start with something small, like $5 or $10 per month. A lot of people make a practice of giving the same amount that they put into savings.
Starting small with giving works the same as starting small with saving: The amounts may not really affect your budget, but they teach you the habit, the mechanics of contributing. Once you see that you can save, or that you can give to charity, you can begin to increase the amounts.
I started my own saving by setting aside just a few dollars a month. Now, four years later, I contribute about $1,000 a month to high-yield savings accounts. If I can save that much for myself, I can certainly afford to set aside a few dollars (or more) to help others.
So, I've made the decision that I can afford to give, and that giving is good. But where should I direct my money? There are hundreds of programs I could support. For example, I believe strongly in the missions of these groups:
- First Book
- Society for the Prevention of Cruelty to Animals
- National Trust for Historic Preservation
I contribute to these organizations already, though. If I'm going to begin a campaign of personal giving, I want my money to do something more.
Last fall, I wrote a review of Banker to the Poor: Micro-Lending and the Battle Against World Poverty, which describes the work of Muhammad Yunus, winner of the 2006 Nobel Peace Prize. Yunus established the Grameen Bank, which offers small low-interest, collateral-free loans to the poor. These micro-loans — most of which are given to women — are used for entrepreneurship, and are surprisingly effective at helping recipients escape the bonds of poverty.
I like micro-lending. I like that it combats poverty through personal entrepreneurship, a notion I value highly. It's like teaching them to fish instead of giving them fish. But how can I, one man in Oregon, provide a small loan to somebody halfway across the world? Fortunately, there's an easy way to do this.
San Francisco-based Kiva is “the world's first person-to-person micro-lending website, empowering individuals to lend directly to unique entrepreneurs in the developing world.”
Kiva allows average people to act as micro-lenders. You can browse profiles of entrepreneurs from around the world, choose somebody to lend to, and then Kiva works with the actual micro-finance organization to distribute the loan. When lenders get their money back, they can re-lend it to somebody else in need.
This video explains more about the Kiva concept:
My goal for today is to set up a Kiva account, and to fund one micro-loan. Though this is a small gesture — a very small gesture — it's a start. It's a first step on the road to charitable giving. In time, I hope to apply the same discipline toward this as I did toward saving. The battle against world poverty is made up of many such small gestures.
Kiva is not the only organization working to fight poverty, of course. Other organizations I may consider donating to in the future include:
- Though Grameen Foundation is not a part of Yunus' Grameen Bank, the two work closely to fight world poverty through micro-finance. If I wanted to just donate money (instead of getting personally involved, as through Kiva), I might choose to do so here.
- Heifer International is a “non-profit, humanitarian assistance, and sustainable development organization that specializes in providing livestock and related services to limited-resource families worldwide. Heifer does this regardless of race, creed, religion or national origin.”
- Oxfam International is an “international group of independent non-governmental organizations dedicated to fighting poverty and related injustice around the world.” Oxfam's lousy web site is vague about how this is accomplished, although several GRS readers have recommended this group in the past.
For more on the subject of giving and micro-finance, check out the following stories from the Get Rich Slowly archives:
- What should a billionaire give, and what should you?
- Banker to the poor: Micro-lending and the battle against world poverty
- One hen: How one small loan made a big difference
- EARN: Helping low-wage workers learn to save
I'm not naive — I don't believe that poverty will ever be eliminated from the world completely — but I hope that through my actions I can help a few other people achieve their dreams, as I've been able to achieve mine.
Its proper place is in a museum.
— Muhammad Yunus, Banker to the Poor —
Today is Blog Action Day. The topic this year is poverty. This is the first of three posts about the subject today at Get Rich Slowly.
Author: J.D. Roth
In 2006, J.D. founded Get Rich Slowly to document his quest to get out of debt. Over time, he learned how to save and how to invest. Today, he's managed to reach early retirement! He wants to help you master your money — and your life. No scams. No gimmicks. Just smart money advice to help you reach your goals.