People have a lot of opinions about money.
In our “Money Mic” series, we hand over the podium to someone with a strong opinion on a financial topic. These are their views, not ours, but we welcome your responses.
Today, LearnVest Deputy Editor Allison Kade discusses why (and how) she gives 10% of her total income to charity—and why she's surprised that people find this unusual.
I give away 10% of my income every year. This year, I gave a little more.
Giving thousands of dollars to charity and various causes is, for me, an I’ll-meet-you-halfway token to the universe. I wish the world were a certain way—respectful of the environment, for example, and free from poverty—and it only seems fair that I put my money where my values are.
The 10% number is Biblical in origin (an “overheard in synagogue,” if you will), but I don’t give this money away for religious reasons. In fact, I was surprised when, in a recent conversation, a friend termed this "radical giving" on my part.
I don't think my 10% is terribly groundbreaking, but I do think the "I'll wait 'til I have more money" excuse doesn't hold water. Most people should be able to manage it. I'll show you how I did it, at least.
How I Started Giving the Way I Do
Ever since I was a kid, giving 10% was a goal, but it always felt far in the future. My parents made it clear that they gave to charitable causes, and they had me and my sister start at a young age.
At home, we had a "charity box," and we had to drop any loose change or money we found on the street into that box. I have memories of proudly donating $15 in pennies and nickels to our local community center when I was 6 years old. By middle school, I consistently gave away a portion of my allowance money. It was only after graduating college that I was faced with how much to give on my own, as an adult.
My first year after graduating, I was making a low entry-level salary. 10% remained a goal at that point, but I figured it would take many years to reach it. I compromised and gave 10% of my disposable income (what I had left over after my necessary living expenses). I'll give a whole 10% later, I thought.
I took informal polls of my friends and colleagues to see what they gave. Usually the answer was somewhere around 1% to 3%. But I felt guilty. And, if we’re being honest, judgey. They might use the “I’ll give when I’m rich enough” excuse, but that wasn’t me. Except that it was.
Fast forward a few years. I’m dating a great guy. I ask my informal poll. His answer? 10%. No matter what. To me, that felt steep, especially when viewed at a glance (“Thousands of dollars!”). But if he did it, why shouldn’t I?
So I did.
Why I Give Where I Give
When deciding where to give, I let myself be guided by what matters to me intuitively. Ever since I was little, I've cared/worried about the environment. Don't laugh ... but as an elementary schooler, I used to cry at night because of global warming. I grew up in Florida, and imagined my house sinking underwater. In high school, my allowance money went to the Nature Conservancy. In more recent years, I've chosen to give to the NRDC Action Fund.
Living in NYC, I also see homeless people on a daily basis (one day I counted, and I literally saw 13 on my commute to and from work). It makes me feel terrible to blithely walk by, but, frankly, I don't like the idea of giving out money to strangers. I've taken to buying Nutrigrain bars I can give out on the street, but that's because I think pretending not to see someone is unhealthy for both them and me--but Nutrigrains won't fix anything for real. So I give more significant sums to organizations I know will manage it wisely. I give the biggest percentage of my money to organizations that help the homeless or help prevent the cycle of poverty before it starts, like City Harvest and Modest Needs.
This year, I also gave a significant amount to Partners in Health, particularly because of the totally insane cholera epidemic that has afflicted Haiti in the past year or two. I visited Haiti two and a half years ago when my friend was living and working in a clinic there, and I felt horrible standing idly by. But, yes: There are other crises in the world that I am not helping out with. It makes me feel a little powerless.
The Nuts and Bolts: How I Do It
I'll start by recounting my blessings: I don’t have a mountain of debt to pay off. I have a steady job. I have low health care costs. I am single and have no kids, so my financial obligations are limited.
That said, I’m no trust fund baby. I have no enormous bounty. I simply don’t spend a ton. Even while donating 10%, I still manage to max out my retirement account. I bought one pricey purse … once. And, even though I could afford it, I pondered for, like, months.
I felt the pinch when I went from giving 10% of my disposable income to 10% of all my income, but, frankly, it wasn't a big deal. As I slowly graduated from an entry-level salary, I didn't change anything about my standard of living. Even though I could theoretically afford more, I live with a roommate (in Brooklyn, not Manhattan), bring my lunch to work most days and choose my luxury expenses very carefully. Upping my giving didn't require major sacrifices because my disposable income grew while my expenses stayed the same.
Here’s what my budget breakdown looks like in the My Money Center:
As you can see, I live relatively simply and pay very little for rent—at least by New York City standards. Although I buy myself things as necessary, I'm not a big shopper. I'm hard to buy presents for. There's not a great deal I want.
How Do You Give?
How do you fit charity and tithing into your budget? Or don't you? SHARE
How Much Should You Give?
I don't want to sound holier-than-thou. My main thesis is this: A flat 10% isn't right for everyone.
Certain basic life costs are the same for all of us: A loaf of bread costs what it costs, whether you're rich or poor. Gas costs what it costs, period. I think that a low-salaried worker should still give something to charity, but I also think that celebrities with millions of dollars aren't terribly impressive for giving a mere 10%. If you make $1 million in a year and give away $100,000, you still have $900,000 to play with. That's a lot of loaves of bread.
My first year out of college, I gave 10% of my disposable income, because I simply didn't have as much to go around. In the future, if I become very wealthy, I'd like to give more than 10%.
When You Shouldn't Be Giving Money Away
Financially speaking, what I'm doing isn't right for everybody: People with serious credit card debt shouldn't give too much to charity. They should just focus on paying off their debt and give their time and effort to charity in the meantime. (For ways to donate your time and other things besides money, read this.)
I acknowledge that, when it comes to giving, one size doesn't fit all. All I can speak to is what giving has given back to me: an outlet for my concerns about the state of the world, and the usual warm mushy feelings when I think about the people eating the food I was able to fund, or receiving cholera vaccines that I provided.
When I say this, I feel confident my boyfriend would agree: Giving to charity isn't so much a nice-to-do as something I feel compelled to do. As I see it, none of us has the right to complain about the way things are unless we become active agents of change.
More From LearnVest
Don't crash in all your giving at the end of the year. Here's how to budget for giving all year long.
No need to be a rich old person to give back. We found 10 big-time philanthropists ... who happen to be kids.
We've come up with 6 creative ways to stretch your charitable dollars.