How to give a little extra by leveraging resources you may already use!
Frugality is not about skimping on everything, it is about aligning your spending with your values. Beyond covering the necessities like food and shelter, I spend money on what makes me happy. Supporting causes that are near and dear to me makes me happy and has always been a priority of mine. Much more than acquiring more stuff. So even with a high savings rate and a frugal lifestyle, giving is and has been an important part of my overall budget.
Whereas in-kind donations as well as donations of time in the form of volunteering are appreciated, most charities need cold hard cash to keep doing what they are doing. Especially the smaller ones that don’t have access to grants or other big fundraising opportunities.
Although my shopping skills allow me to efficiently acquire items from the wishlists of the organisations I support, I generally make it a point to also give both money and possibly time to causes I care about on top of just stuff.
Also, I am always looking for ways to give a little extra, by leveraging giving opportunities, that can add to my own monetary donations.
Here are a few examples of things I have been using:
This is an often overlooked source for donations. My former employer, a large Multinational, offers a matching gift program, through which up to $2500 of personal donations made by employees to qualifying non-profit organizations are matched with a 50% company donation. While employed, I made ample use of this great benefit. As I knew I was going to start my Sabbatical in 2016 I front-loaded my donations to make sure I was getting the full employer match possible for the year. It was an easy way to have my employer support some of the organizations that are meaningful to me.
It’s a little extra paperwork, but not too bad considering the great return on time investment. To make it easy on the charities, I filled in most of the required information and sent it along with a stamped and addressed envelope. So all they had to do is sign and forward to my employer along with the receipt for my donation.
Some companies even match up to 100% of much higher amounts than the $2500 mentioned above. One lady who “bought” stuff from me for a donation toward my favorite pet shelter during my downsizing adventure, had such a sweet 100% deal and when she realized what I was doing, was kind enough to make out a check directly to the pet shelter I was trying to help, along with the matching gift paperwork. Now that was a win / win /win all around!
It is definitely worth checking if your employer offers a similar program, many companies do!
Everybody buys stuff on Amazon, even us frugal types. I like that Amazon also has a giving program called d Amazon Smile, through which they donate a VERY small amount of the value of your purchases to a charity designated by YOU. The donation however is so small that sometimes it will make more sense to shop around and see if you can find a better deal somewhere else and directly donate the money saved to your favorite charity, instead of going through Amazon Smile. If the price is the same though, this is a great way to donate a little extra via something you are doing anyways.
It’s relatively easy to set up. The first time you go through Amazon Smile you search for and select your charity and then future qualifying purchases will support the charitable organization you have designated before. Unfortunately there is no way to track your donations. But you can check if the organization you want to support is also a participant of the regular Amazon affiliate program (it’s something they’d disclose on their website), which can be a more efficient way to support them as the affiliate program gives them a higher payout and the chance to actively track the amount they’ll be receiving.
Swagbucks is an online portal that lets you earn Swagbucks (their “currency”) for shopping online, filling out surveys, watching videos, using their search bar etc. You can then trade in these Swagbucks for gift cards or donate them to a number of organizations. In some cases Swagbucks will give you extra Swagbucks for donations you make or they will match your donations to said charities.
Frys is a grocery store in AZ that is part of the Kroger group. This information is AZ specific, but I am pretty sure grocery stores in other parts of the country have similar programs.
You can support nonprofit organizations in your community by shopping at Fry’s grocery stores. All you have to do is enroll in Fry’s Community Rewards.
Go to https://www.frysfood.com/topic/new-community-rewards-program and scroll all the way down to where it says “enroll”. All you need to do is sign up with your customer loyalty card and select a local organization you wish to support. Once you’re enrolled, you’ll earn rewards for your chosen organization every time you shop and use your card. The only downside is that you have to Re-Enroll once a year. You can change the organization anytime you want during the year. And Fry’s will display the amount of $$ your purchases helped to donate to said organisation. This really does not take a lot of extra work and is a very easy way to help out a local charity that may have limited fundraising opportunities.
Bashas grocery stores
(includes Food City and AJ’s)
This is another grocery chain local to AZ. Bashas has a bit more of a complicated program, using Community Support Cards but if you shop at Bashas, Food City or AJ’s check if your favorite organizations participate in their program. You pretty much buy a re-loadable gift card from the organization of your choice (NOT from Bashas!) and the organisation will earn 6% on all purchases you buy with that card. So it’s a bit more cumbersome, as you have to get the card first and then reload it with the amount you think you are going to spend. But then it may be worth it if you shop there often and are willing to jump through the hoops, as 6% on groceries can up pretty quickly.
Kohl’s seems to have a similar gift card based program, but you’ll have to check with your charity of choice first if they participate or consider encouraging them to apply, if you spend a lot of money at Kohls.
Ebay for charity
Ebay offers two ways to help charities of your choice:
As a seller, you can select an organization and donate a part or all of the proceeds of your sales to that organization. You can use the fact that your are donating to charity to promote your offers.
As a buyer you can specifically shop for items that support certain organizations.
If you are using Ebay a lot, this is a great way to help out a charity via something you are doing anyways.
Donate Miles / Points
Pretty much every major airline loyalty program and most of the hotel programs have an option to donate miles or points to charity, some even have a nice variety of organisations to chose from.
I recently donated some miles close to expiration that I knew I wouldn’t be able to use before they expire to Doctor’s without borders. This may happen to some of you travel hackers out there, despite the best efforts to use them all up. So before you just let them expire, please consider donating to a worthy cause in case the program you are participating in allows it.
Each program is different, some only allow multiples of 1000 miles some allow whatever number you fancy.
It stings to loose miles, but using them to help out a great organization, can lessen the pain a little bit. Even better if you have that many that you can easily give some of them up for a great cause. When I was travelling a lot more for work, I would do this on a regular basis.
AZ Tax Credit (for contributions made to a Qualifying Charitable Organization)
The following information is relevant for AZ. I am sure there are equivalents in other states, so do your research if you are not located in AZ. Also I am by no means a tax specialist, so please make sure you thoroughly research any and all details before counting on any credits. You can find updated information here: https://www.azdor.gov/About/FAQs/CharitableTaxCredit.aspx
A Tax Credit, unlike a deduction reduces the amount of tax you owe, dollar-for-dollar. So even if you don’t itemize you will get a full reduction of your income tax liability in the amount of the credit.
That pretty much means, while you are paying this money anyways, might as well send it to an organisation you want to support instead of spending it on taxes. No brainer, right?
AZ allows you to get a tax credit for for contributions made to qualifying charitable organizations on this list https://www.azdor.gov/Portals/0/RefundCredits/CertifiedCharities2016.pdf for up to $400 for single or head of household or up to $800 for married taxpayers.
Even better, beginning with the 2016 tax year, credit eligible contributions made to a Qualifying Charitable on or before April 15th may be applied to either the current or the preceding taxable year and are considered to have been made on the last day of that taxable year. So that means you still have time until 15th April 2017 to reduce your 2016 AZ taxes whilst ensuring that a local qualifying charity can benefit from that money.
You can find out more information here: https://www.azdor.gov/About/FAQs/CharitableTaxCredit.aspx
Setting up a Donor Advised Fund
Ever since I read about donor advised funds on Jim Collins Blog, I have really really wanted to start one of those.
A donor advised fund let’s you take a deduction for a donation in a high income year at the point in time when you contribute to the fund. You can then spend the money over subsequent years. It can also be a great way to donate assets that have unrealised capital gain, which can help avoid capital gains tax. Many larger organisations can accept appreciated stocks and bonds as well, so you don’t necessarily need this middle man (yes there is a fee). But if you are giving very locally to small organisations, that don’t have that possibility a DAF may be the way to go.
Many brokerage companies offer donor advised funds. Two that I have looked into are Vanguard and Fidelity. The minimum amount at Vanguard is $25 000, Fidelity has a much lower threshold at $10 000.
It was high on my list to open one in my last “high income year” before FIRE, but as I am “only” taking a year off and have not hit “my number” yet, it will have to wait a little bit, to see how everything will pan out for me.
I also really wanted to have mine at Vanguard despite the higher threshold, because that is where I have the rest of my investments as well. The fun thing at Vanguard is that the minimum distribution is $500 per donation. So at a $25 000 minimum investment, you could test the 4% rule on a small scale and see how it works out, giving 2x$500 ($1000 in total = 4% of 25k) to two organisations of your choice year after year. It would have been interesting to track the famous 4% rule with a fun giving experiment for sure.
I will definitely open one of these funds in the not so distant future depending on how my future employment will work out. I really have been wrecking my brain lately thinking about how I can increase charitable giving, while I am living off a significantly decreased income. Any pennies made blogging (all 96 of them earned so far) are earmarked for donations anyways, so hopefully my two blogs will contribute to that fund a bit at some point (hey one can dream) although it’s not looking like that’s going to happen anytime soon. Not having to lower my monetary donations is seriously one major motivating factor of going back to work in some way shape or form.
I know there are other things out there, like those websites where you click or answer questions once a day and they donate part of their advertising income to charities. There are also “cash back” credit cards, that donate to non-profits instead of giving you the cash back.
I generally prefer options that let me designate the receiving charity myself and possibly give at least an indication of the impact whatever activities they require me to do are having. I am always interested in finding more options doing things I am doing anyways. So if you are using anything you are particularly fond of that fits those requirements, please do share.
An addition NOT a replacement
I think it is really important to make sure our charitable shopping or “creative re-directions” of tax expenses ADD to our overall charitable contributions and don’t replace them. I see a lot of people patting their own backs for “liking” a cause on Facebook or clicking a link somewhere. Sure, that “feels good”. While I don’t want to diminish the good intention behind such actions, ultimately if we really want to help out a cause we are truly passionate about, we do have to support it with our wallet, now even more than ever before.
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