Most people agree helping those in need is important. How much can you help others without jeopardizing your own finances?
The degree to which you help others is a personal decision weighed against your own financial situation. I often use the analogy of an airplane losing cabin pressure. In the case of that unfortunate event, flight attendants advise you to put your own oxygen mask on before helping others. It’s important to secure your financial situation before helping others. If you fail to build your own foundation first, you might both end up in a financially risky situation.
Financial gifts aren’t the only form of giving or even the most rewarding kind. The three ways to be charitable are time, talent and treasure.
Perhaps the most valuable gift you can give is your time. Volunteers are among the most sought after resources for nonprofits. Donating your time is extremely valuable. Just ask the leader of any organization.
If you were to put a dollar amount on volunteering, it would be a very generous gift. Plus, it doesn’t require any skill to show up with a smile and pack blankets for the homeless or tutor a student.
What skills do you have that you could donate to a charity or nonprofit? Maybe you’re a skilled artist 1 or you could volunteer as an assistant coach in your favorite sport. Perhaps you could build a Facebook page for an event or help students prepare for interviews.
I know an accountant who helped arrange the donation of a building. He didn’t own the building, he just helped the owner recognize her charitable tax deduction would exceed the proceeds from selling it.
If you don’t have time or talent to contribute, there’s always treasure. Even better, do all three! Anyone who tithes to their church understands giving in proportion to your ability. Giving a small gift is better than no gift at all.
We all want to be financially generous. But, In the long run, it makes more sense to give a small gift you can afford now rather than giving a medium gift that stretches your budget. By tracking your Net Worth, you can give more generously in the future with confidence.
But, how do you know what you can afford? In giving and otherwise “what can I afford?” is a significant question which I’ll address in my next article.