Being Charitable in Tough Times
Times are tough all over, recovery is slow, and we still face some very uncertain economic times ahead. Obviously charitable and non-profit organizations feel the pinch of belt tightening most significantly – as donations drop off, and more people require their services. It is a conundrum charities face during every economic crisis as they are forced to do more – with less.
According to a recent article in USA Today, overall charitable giving dropped in 2008 by about $308 billion. Individual giving was down by about 3% and corporate giving fell by about 4.5%. On the other hand, charitable grants by foundations rose by about 3% during the same period. Interestingly enough, donations to religious organizations rose almost 6%. This seems to indicate that during tough times people are more likely to turn to and support their houses of worship.
Also encouraging is that while monetary donations by individuals to charities is understandably down during tough economic times, volunteerism increased. In 2008 the number of people contributing volunteer hours to a charitable organization rose by over 1 billion. According to the experts, volunteering is a great way to help out cash-strapped non-profits, and also yourself. Career Counselors point out that if you have been out of work for a while – you not only have the time to give, but helping out a charity can help you deal with your own feelings of anxiety, give you a much needed boost of self-esteem, and the opportunity to learn new skills and make contacts, that may lead to full-time employment.
When monetary donations decrease during economic downturns, charities often encourage other forms of donations. One such successful program is donating used cars and other vehicles. If you itemize your taxes, and often rely on charitable giving for a deduction, but have been unable to make the kind of cash donations you have in the past – this could be a great way to help out your favorite charity, and yourself, when cash flow tightens.
Rethinking tax strategies is important to investors as well during times like these. While overall the value of the markets have been down for most investors, you no doubt have some securities in your portfolio that are worth more now, then when you purchased them. Well-known investment firm Schwab advises that you may want to consider donating appreciated stock to a charity, and thus avoid paying capital gains taxes.
Financial advisors also suggest that if you want to help out your favorite charity, and may not have the cash on hand to do so, you may have life insurance polices, or other “overlooked” assets that you can donate to a charity.
The bottomline is, even in tough times anyone can find something, or someway to still give to his or her favorite charity. Charities need more than money to do the work they do. Donations of time, food, toys, and clothing are always welcome – remember you can always open your heart, even if you cannot open your wallet.
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