Jim Wang and his family like to carve off some of the family holiday season budget for a great cause — giving to the needy.
So far, his creative way of doing so has helped changed his view of the holidays from receiving to giving.
“A few years ago, we started a charitable giving fund during a year we expected to be taxed heavily,” says Wang, a Pittsburgh resident who writes about personal finance for Wallethacks. “We contribute to it on a regular basis, so it’s part of our monthly budget. Then, at the end of each year, we recommend where a portion of those funds are donated. It never busts our budget because we make regular contributions and we can support our favorite organizations.”
The practice allows Wang and his family to give during the holidays on their own terms. “A good side benefit is that it gives us a good reason not to contribute to certain causes when friends and family ask us — we don’t have the available funds in our charitable giving fund but we’ll allocate it for next year,” he says.
That would make Wang a prime candidate for the newest theme day on the holiday map — “Giving Tuesday.”
Giving Tuesday, which occurs right after Cyber Monday, was founded in 2012 as a way to recognize the more than 1.5 million charities in the U.S. and kick-off giving season, during the last five weeks of the year when at least 24 percent of all charitable donations are made (which amounted to about $358 billion total in 2014).
U.S. companies are already climbing aboard the Giving Tuesday bandwagon. PayPal (PYPL), for example, is attempting a Guinness World Record for Giving Tuesday this year by going after the most money raised online for charity in 24 hours. Last year PayPal enabled a record amount of giving around the world by helping charities raise $5.7 billion through its charitable giving platform, company officials tell MainStreet.
The key for U.S. adults looking to cut a check or two on Giving Tuesday is obviously to help the less fortunate. Past that, you’ll want to give “in a smart and strategic way, maximizing every donation and doing so within your budget,” says Eileen Heisman, CEO of the National Philanthropic Trust and #GivingTuesdayambassador.
Actual charities love the idea. “Giving Tuesday reminds us to be selfless and share a bit of our own good fortune with those in need,” says Cristy Balcell, executive director at MitoAction, an organization dedicated to helping children and families who suffer from the rare disorder mitochondrial disease. “I know we appreciate Giving Tuesday’s national effort to join together.”
So flex your charitable giving muscles by participating on Giving Tuesday.
Start by using the website CharityNavigator.org to find the best and most legitimate charities. The site’s unbiased, objective, numbers-based ratings system to assess 8,000 of America’s charities.
CharityNavigator provides rating based on charity’s financial health, transparency and accountability, and it tracks how efficiently the charity will use your donation and how well has it sustained its programs and services over time.
Gift cards are also a great way to give to charities during the holidays. “There are two types of charitable gift cards,” states Shelley Hunter, a content manager at GiftCards.com. “The first is when a percentage of sale is given to charity. In this type, the recipient gets the full value of the gift card to spend. The charity gets a small portion. The second type of card results in the nearly the entire sale going to charity. The recipient simply designates where the money should go. This is a great way to do your holiday shopping and give back at the same time.”
Hunter offers a great list of charity-driven gift cards.
It’s also OK to get something in return when you donate to charity. “Look for acharity that offers something in return for your contribution, but be aware of where your dollars will go for that gift,” says Suzanne Kwok, executive director of Give To Cure, a charitable group that leverages crowd funding to raise funds to treat diseases. “For example, we have partnered with world famous street artist and activist Shepard Fairey to create fashionable merchandise and actual gifts that people can buy. Any money spent on those items goes directly to supporting clinical trials for Alzheimer’s disease. This way, you get to do a good deed, and your loved one still gets something cool to unwrap and love all year.”
Get your kids involved in donation experiences, too. “Teach your children to give what they can,” says April Masini, a relationship and self-help expert. “A week of their allowance donated is a great teaching moment at this time of year when ‘gimme gimme’ is the mantra in many homes where retail is the religion of choice.”
Of course, keeping a close eye on scams and fraud should be a priority for donors on Giving Tuesday, too. “Scams are abundant during the holiday and scammers prey on the generous holiday spirit of consumers to ‘give extra’ to charities,” says Kiry Peng, president of the Business Consumer Alliance in Colton, California. “Our best tip is to avoid sending cash donations and never wire money. Donating by check made payable to the charity or by credit card is safer and consumers can use those receipts as tax deductions.”
Giving Tuesday is yet another theme-based date on the holiday character, much like Black Friday and Cyber Monday. But unlike those commercially driven mini-holidays, Giving Tuesday offers Americans a chance to do well by doing good, and that’s much closer to the spirit and meaning of Christmas and the holidays.