Learning to Give

For years, Get Rich Slowly readers have given me grief over my charitable giving. Or, more precisely, my lack of it. I was raised in a home that gave neither money nor time to help others. As I struck out on my own, I never picked up the habit of giving. At first, this was because I had myself to worry about. I was deep in debt. How could I afford to help others when I couldn't even help myself? But after I paid off my debt in 2007, I still didn't contribute.

My reluctance to donate to charity has stemmed from several sources:

  • First, as I mentioned, I never learned the habit.
  • Second, I worry about how organizations spend their money. I'm aware of sites like Charity Navigator, which rates charities based on efficiency. But these sites don't tell the whole story.
  • Third, I'm not a fan of charities with ulterior motives. I don't want to support groups that push religious or political agendas. Feeding those in need shouldn't come with a call to convert to Christianity, for instance.

So, for a long time, it seemed easiest to do nothing.

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More about...Budgeting, Giving

What are the moral implications of spending?

Most reader questions I share at Get Rich Slowly are meant to solve a problem — somebody has a financial dilemma they're hoping you folks can help them fix. But Rita sent a different kind of question. She doesn't want to solve a problem — she wants to stir debate. Rita writes:

I ask myself "How much is enough?" several times daily. My husband and I make good money — over $100,000 in combined income — own a home in an expensive city, have two large dogs, and are able to buy most of what we want. I don't have a problem with normal spending, but I often feel bad when I purchase something really nice (such as a nice purse, a collectible book, etc).

  • On one hand, I can afford these things.
  • But on the other hand, I still feel that it's somehow wrong that I continue to buy this stuff while many people in the world cannot afford clean water and food.

Just yesterday, I read an article on an entertainment site about Steven Spielberg's $200 million personal yacht. I think that this a a crazy, immoral waste of money. He could make a HUGE difference by using that $200 million for charity.

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More about...Giving

Getting the most from your charitable deductions

Charitable deductions can be a complex and confusing area of your tax return. Understanding what you can deduct and what you can't deduct can be confusing. Documenting it properly adds yet another layer of difficulty. To help sort it all out, I talked to Kelly Erb, (a.k.a. Taxgirl), and Kay Bell (of Don't Mess With Taxes).

    • Erb is a tax attorney who runs her own tax law firm with her husband. She's also been blogging about taxes for the past six years. Before striking out on her own, she clerked for the IRS, specializing in estate and gift taxes. She also worked for a boutique law firm that primarily handled estates and gifts.
  • Bell is the author of The Truth About Paying Fewer Taxes, and the founding editor of Bankrate's tax section. She has worked on Capital Hill with the House Ways and Means committee.

Both women offered great tips for getting the most from your charitable deductions while taking care to avoid pitfalls that could get your return flagged.

Should You Be Taking Charitable Deductions?

Most people give at least some money to charity, but few of us take our charitable deductions. In fact, only about a third of households itemize their deductions. The rest simply take the standard deduction, which for the 2010 tax year is:

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More about...Giving, Taxes

Christmas Gifts That Make a Difference

Grandma probably doesn't want another scented candle, but she could very well use a ride to the store. Your underemployed nephew would likely prefer a little help filling the pantry instead of a jokey T-shirt. And the sister who's staying home with her kids may not be able to afford any extras just now. Instead of dropping $40 on a sweater, why not put that money toward a membership to the local museum?

You've still got a few weeks to think about Christmas gifts. Make this the year when you pick presents that actually help.

Note: Don't forget that elsewhere on GRS, you can find a huge list of homemade Christmas gifts.

Giving gifts that help

I've put together a list of items that save the recipient money or fill a specific need. Prices range from as little as $5 to upwards of $50 or more — and some of the suggestions will cost you little except time. Continue reading...

More about...Giving, Planning

Giving away, not selling, my stuff

Ever since I cleaned out my closet, I've gotten more and more ruthless, editing more and adding less.

The result of deleting items from drawers and hangers is two large brown boxes taking up floor space in the closet, overflowing with castaways. The boxes have grown into mountains, and I can't walk to the back of my closet anymore.

My intention was to sell these items, which are the nicer things that I actually like, but don't work for one reason or another. I didn't want to drop them off at the consignment shop because the shop keeps 60% of the profit and only accepts in-season clothing, meaning I'd have to keep some of this Stuff in my closet for almost a year. So I planned to sell it on eBay, thinking I could make some of my money back and maybe sell the out-of-season items.

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More about...Giving, Clothing

Using Consumerism for Social Good

When I shampoo my hair, I'm helping buy bicycles for girls in Togo to get to school.

According to UNICEF, in Togo, a small nation in West Africa, about half of the women 15-24 years old can't read or write, and the numbers are higher for those in rural areas where there's no access to transportation. Children have to walk 5 to 15 miles, and girls, who typically have more household chores than boys, are particularly likely to drop out before secondary school.

You're probably wondering what bikes in Africa have to do with shampoo. All costs of the Bicycles for Education project — shipping, bike repairs, distribution, and follow-up costs — are paid for through the sales of Alaffia products. Alaffia is a line of hair and skin products made from fairly traded, handcrafted shea butter. While the pros and cons of fair trade certification have been debated, Alaffia founder Olowo-n'djo Tchala, who grew up in poverty in Togo, puts the African communities first, with direct involvement in the entire process and 10% of sales going to community empowerment projects. The current list of projects includes the following:

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More about...Giving

Banker to the Poor: Book Review and Summary

When J.D. announced that this week would be Book Week at GRS, I was excited about a set deadline for tackling a book from my ever-growing reading list. Since micro-finance and micro-credit have been of interest to me for the past four years or so, I decided to read Banker to the Poor: Micro-Lending and The Battle Against World Poverty by Muhammad Yunus. (J.D. reviewed the same book in 2007. Read his take here.)

Nobel Peace Prize winner Yunus is the founder of Grameen Bank, an organization that helps the world's poorest, especially women, escape poverty through micro-loans, which are small loans given to start a business.

Banker to the Poor chronicles Yunus' journey from a "bird's-eye-view economist, teaching elegant theories in a classroom, to a worm's-eye-view practitioner" and the creation of Grameen, a bank owned by its poor borrowers that boasts a loan recovery rate of 97.29%.

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More about...Books, Giving, Side Hustles

I quit my job and joined the Peace Corps

This article written by Bon is part of the "reader stories" feature at Get Rich Slowly. Some stories contain general advice; others are examples of how a GRS reader achieved financial success — or failure. These stories feature folks from all levels of financial maturity and with all sorts of incomes.

I've always been a bit of a capitalist so to speak, so when I decided to join the Peace Corps several years ago, not only was it a shock to my family and friends, it was a little bit of a shock to me. At the time I loved my job but knew that I would regret staying too close to the corporate path I had been following.

Calculating Opportunity Cost
One of Bonnie's young friends

When considering a major lifestyle change, ask yourself if you're really losing your entire salary when you take a break from work. When I was weighing the financial impact Peace Corps would have, I knew the program would cover my travel, living expenses, and health care, so I wouldn't really be giving up my entire salary for two years. I'd only be giving up what I might potentially have saved at the end of each year. Instead of my opportunity cost being something like $100,000 for two years, it was actually closer to $14,000 total. This seemed like a reasonable price to pay for the experience. Continue reading...

More about...Career, Giving

Social Capital: More Valuable Than Money?

I'm back! After ten days boating through southeast Alaska (and two days of recovery), I'm ready to think about personal finance once again. Actually, it'll probably come as no surprise that I never stopped thinking about personal finance. Even while we were skirting among ice floes, pulling up prawns, and admiring whales, my mind never strayed far from the topic of money. (I'm not saying this is a good thing, but it's the truth.)

It'd be all too easy for me to share another sermon about the perils of Stuff — when you spend ten days on a 38-foot boat, living out of a single carry-on bag, you come to realize how little you actually need in life — but I feel like I've beaten that topic into the ground over the past few months. I'm working to cut down my dependence on things, and I know that many of you are, too; let's save further discussion for another day.

Today, I want to talk about the value of social capital.

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More about...Giving, Psychology

Give your wealth away: An argument for a secular tithe

This article was written by Sierra Black, a long-time GRS reader and the author of ChildWild, a blog where she writes about frugality, sustainable living, and getting her kids to eat kale. Previously at Get Rich Slowly, Black told us about sweating the big stuff and the pitfalls of buying in bulk.

My mother's family is Catholic. They're working class people from Buffalo: nurses, drugstore clerks, steel mill workers. Even though they never had a lot of dollars, they always gave 10% of what they had to the church. Like taxes, that 10% was just something they paid out before spending a dime on themselves.

As an adult I became the first college graduate in my family and adopted the position most of my educated, liberal peers seemed to hold toward charity: give a little, when you can, and feel guilty about not doing it most of the year.

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More about...Giving