Maximize your charitable giving this holiday season
Philanthropy is an integral part of American culture, so it’s no surprise that 91 percent of Americans donate to charity regularly, according to UBS’s Q4 2014 Investor Watch report, “Doing well at doing good.”
Whether it’s a request at the checkout line at the grocery store or an end-of-year gala, the opportunity for charitable giving is everywhere, especially during the holiday season. We’ve all seen these types of donation requests and charity event invites, but how do we know if we are truly making a difference when we give?
According to the Investor Watch report, only 20 percent of those surveyed think their current approach to giving is effective. As a financial advisor, I believe many donors may not always understand the full influence of their philanthropic efforts. Consider these tips to help feel the true impact of your donations this holiday season.
So many people give reactively upon request by writing checks or giving cash, but your gifting strategy will mean more to you – and the causes you support – when you make a plan to determine what you want to achieve through your efforts. Many of us associate charitable giving with the holiday season, but you may potentially make
a bigger impact on the charities you choose to support earlier in the year during a key fundraising season. Meet with your financial advisor at the beginning of each year to help you determine what you can afford to give, and when, to maximize your impact. According to the Investor Watch report, planning for giving raises donor confidence and impact by nearly 50 percent.
Know who you are giving to
Be sure to research the causes and charities you support. Each dollar you donate doesn’t go directly to relief or aid. A portion of each donation may cover necessary administrative costs that keep the organization operating seamlessly. However, it’s important to know what percentage of donations is used for administration and how much goes directly to the cause, as this figure may determine which charities you want to work with. Online resources can report information about nonprofit organizations, including how their dollars are spent.
See your giving in action
Give time to supplement monetary donations. Often when we give, we don’t know what happens past the initial donation, but volunteering time can
show you just how important your donation is. Consider scheduling a day of service at work or volunteering with your family. Donors often feel the best about their charitable donations when it is complemented by volunteering and working with those in need. Volunteering often provides the feedback we’re curious about, but continue to maintain communication with the organization and ask how your donation benefitted the cause. This strategy is especially popular among young professionals, as millennials are very philanthropic but may not have as much flexibility in their budget to give monetarily, according to UBS’s 4Q2014 Your Wealth & Life report, “Charitable giving*.”
Have a strategy
Work with your financial advisor to help determine the best way for you to give, whether it’s through cash donations, appreciated securities in a donor advised fund, or through a foundation. Each vehicle offers different benefits for the donor and recipient, so be careful when you structure your donation. Tax benefits are an added bonus in giving. While this is not the deciding factor when allocating finances for giving, be sure to work with your CPA so you can take advantage of the savings.
Your philanthropic efforts are not just about the dollar value given, but rather the value your efforts have on the community. Develop a strategic plan for your giving that
will not only benefit the causes you are passionate about, but that can also make you feel good about your giving.
John Garvey is a Financial Advisor with UBS Financial Services Inc., a subsidiary of UBS AG. Member FINRA/SIPC in Philadelphia, Pa. The information contained in this article is not a solicitation to purchase or sell investments. Any information presented is general in nature and not intended to provide individually tailored investment advice. Investing involves risk and there is always the potential of losing money when you invest. The views expressed herein are those of the author and may not necessarily reflect the views of UBS Financial Services In. Neither UBS Financial Services Inc. nor its employees (including its Financial Advisors) provide tax or legal advice. You should consult with your legal counsel and/or your accountant or tax professional regarding the legal or tax implications of a particular suggestions, strategy or investment, including any estate planning strategies, before you invest or implement. In providing wealth management services to clients, we offer both investment advisory and brokerage services which are separate and distinct and differ in material ways. For information, including the different laws and contracts that govern, visit ubs.com/ workingwithus.