Ask Brianna: Can I Give to Charity If Cash is Tight?

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“Ask Brianna” is a Q&A column for 20-somethings or anyone else starting out. I’m here that will help you manage your hard earned money, look for a job and repay student loans – all of the real-world stuff nobody taught us how you can do in college. Send your questions about postgrad life to?askbrianna@nerdwallet.com.

This week’s question:

“This time around of year, I’m getting a lot of requests to donate money, but bills and debt payments are hanging over my head. I want to be generous. Can I give to charity anyway?”

Congratulations: You have a heart. The need to donate develops from a host to compassion and empathy, and it’s worth celebrating.

“We can’t avoid being human and attempting to help others,” says Derrick Feldmann, lead researcher on the Millennial Impact Project, which studies millennials’ philanthropic behavior.

Feldmann says millennials donate $200 to $300 annually typically, and closer to $400 in years when major disasters occur.

While you cannot give money you don’t have, you can do your part to save the planet even with, say, 1000s of dollars in student loan debt. You’re financially prepared to give if you are:

  • Earning more money than you spend
  • Paying a minimum of the minimum on your debts, promptly, every time
  • Saving regularly for the future both in?emergency?and?retirement funds: That means setting aside a minimum of $500 for unexpected expenses and contributing enough to obtain the company match on your 401(k) – or saving within an individual retirement account

Once you’ve determined you can spare some cash for charity, try this advice regarding how to do it. And if donating isn’t possible this season, consider volunteering or taking part in activism instead.

Build your values into your budget

Your question is about spending money on what you value most, and that’s all budgeting really is. Figure out what you can spare by taking a look at how much can be obtained for discretionary spending.

Using the 50/30/20 guideline, try to spend a maximum of 30% of your after-tax income on wants (50% of the take-home pay goes to needs like housing, food and utilities; 20% would go to paying down debt and saving for the future). Decide how a lot of the 30% you need to hand out. Maybe you’ll decide $20 a month can turn to charity.

This approach makes it simple to setup automatic recurring donations, instead of giving lump sums after the entire year, says Elise Murphy, a professional financial planner at Level Financial Advisors in Amherst, New York. You won’t feel crunched or drain your money in November and December, when you’re also buying holiday gifts and traveling to see family.

Donate strategically

Once you’ve earmarked your precious cash for charity, place it to get affordable use.

  • Donate your full charitable giving budget to simply a couple of organizations, says Eileen Heisman, CEO of the National Philanthropic Trust. Sending $10 to twenty different organizations won’t make as big an effect, because it is expensive to process every donation.

If you give more to 1, “the charity may have more net money to really devote to programs,” she says.

  • Ask in case your workplace matches donations, which will make your money go further.
  • Keep records of the donations; you can deduct them from your taxable income if you itemize on your taxes and also the organization qualifies under IRS rules. Check its eligibility while using IRS’ Exempt Organizations search tool.
  • Make sure you’re giving to reputable organizations. View nonprofits’ financial information by signing up for a forex account on GuideStar.org, or browse the Better Business Bureau’s reports on individual charities on Give.org.

Give your time and effort instead

Sure, of millennials who’ve been more associated with causes or social issues because the 2016 election, the largest share – 35% – said they’d donated more money. That’s based on the 2017 Millennial Impact Report, released by Achieve, a cause-focused research and marketing agency. But the next-largest share said they volunteered more, followed by people who said they joined more nonprofit boards.

Your budget should be too tight to contribute money; maybe rent alone occupies half your take-home pay. If you’ve decided animal welfare is your cause of choice, volunteer at a shelter in order to walk dogs for elderly owners. Sign petitions, attend community meetings or take part in a run or walk to raise awareness of an issue.

“You don’t have to have any money compare unique car features,” Feldmann says.

This article was compiled by NerdWallet and was originally published by The Associated Press.?