The Art of Charitable Giving: Maximizing Impact, Minimizing Taxes, Leaving a Lasting Legacy."
In the past, I would never describe myself as being particularly charitable. It’s not that I wasn’t compassionate or completely selfish, but honestly, I didn’t think that anything I contributed to charity would make a meaningful difference. I wasn’t able to write a significant cheque. The other reason, there wasn’t a particular cause that I was passionate about. I believe that you need to feel you’re making a difference to a cause that you’re genuinely passionate about. Although having the money makes it easier to make a meaningful difference, there are several other ways to donate to charities that are far more efficient, requires significantly less as a contribution and allows the charity to benefit exponentially better than if someone was writing a cheque, giving cash or contributing monthly or annually through a credit card debit.
Majority Rules
I’m not alone in my thinking. In an informal poll I conducted, more than 75% of respondents felt their contributions to a charity wouldn’t make a meaningful difference. As Mark Halpern has explained, cash is no longer king, especially in charitable donations; it is the worst way to contribute to a charity. Mark’s pdf, “More Than 20 Ways to be More Generous”, explains some incredibly tax-efficient and great ways to give to charities that many accounting professionals are unaware of. Now, you can provide significant charitable donations for literally just pennies on the dollar, and the charity benefits significantly.
All Donations Are Not Created Equally
If money were no object, would we be more inclined to donate to a charity? My guess for the majority of people would be an overwhelming yes. What if you could give a significant sum of money to a charity, which would only cost a small fraction of the actual amount? Would you be more inclined to donate? Again, my guess would be an overwhelming yes. How you donate to a charity is almost as important as how much you contribute. Many more individuals may be more inclined to donate if they realize the difference.
Make an Example of Yourself
Take this example; a couple donates $100 monthly to a charity using a credit card debit. Annually, they donate a generous amount of $1,200/year. But what if a couple could donate $100,000 to the same charity for this same monthly amount? Suddenly, this couple is revered and recognized as significant donors by this charity. How much further would their donation go now? What if ten other donors who contributed $100/month changed the format of their donation? That charity just went from being a $12,000/year benefactor to receiving a $1 million gift! How many more lives could this charity positively impact? This is why how you give is arguably as important as what you give.
What Charity Ignites Your Fire?
There are a tremendous amount of charities doing incredible work and changing lives. Until recently, although I’ve appreciated the hard work and dedication many charities make to a community, nothing resonated as significantly as The Maddie Project. Of course, the Maddie in the Maddie Project is my late daughter, who lost her life in April 2015 to depression.
Having witnessed firsthand the mental health challenges facing so many youths in today’s society and the significant shortfall of services and support offered beyond the emergency room visits to your local hospital brought this crisis to a head within our family. Personally, having talked to hundreds of families impacted by mental health helped me realize the immediate need beyond our family, that this was an epidemic in waiting. Had these additional services existed six years ago, would we have a different conversation today? We can’t bring Maddie back, but we can bring light to today's youth mental health crisis and how families seek help and services for their children.
Do We All Have Another Calling?
Some realize it very early, and some never understand their ultimate calling. I didn’t know this until after the loss of my daughter. What we choose to do about the events that have changed our lives is a very personal thing. What is the deeper meaning behind the message? I’ve indeed become more spiritual as a result, but what we elect to do or what meaning we give it is unique to each individual.
For me, it is to share with others what we have gone through with Maddie, so hopefully, others will not have to endure the same pain that our family has endured. Also, having dealt with my battle with depression, I can relate so much better to others who also suffer from mental illness. This applies to both my personal and my professional life.
Professionally, my business allows me to coach business owners on how they can use their business to create a tremendous legacy, benefit others, and consequently minimize the taxes they pay. This could be taxes owed today or in the future through capital gains on real estate, investments, or the sale of a business.
What is Your Reason?
Whether you want others to benefit or whether you or your estate want to pay fewer taxes doesn’t matter. Mark coined the term “Accidental Philanthropy” when people choose to become philanthropists when allowed to leave money to charity and family instead of the tax department.
What is your reason?
