Charitable giving is admirable, but if you’re new to philanthropy, it can be difficult to know where to begin. There are many worthy causes out there, but how do you determine which one is right for you? Here are some tips to get you started:
Define Your Objectives
The first step to becoming a philanthropist is to determine your goals for your donations. Your giving will mean much more to you if you give to a cause that aligns with your personal values. What type of cause do you want to support? Think about what is important to you and imagine what positive change you would like to see in that area. After you determine your goals for giving, commit those goals to paper.
Create a Strategy
The next step to charitable giving is to create a strategy. You need to know how you will give.
You may choose to give money, or you may choose to give your time. Many organisations need volunteers as much (or more) than they need monetary donations. Also, consider if you would like to give on your own or include your family in the process.
This is also a good time to decide if you would like to give locally or internationally. No matter where you live, you can find a local need. However, you may choose to give internationally, such as to developing countries.
You work hard for your money, so when you decide to give some away, you probably don’t want to see it go to taxes. In 1990, the UK implemented Gift Aid, which is a way for charities to claim the basic tax rate that you have already paid on a donation. This allows the organisation, rather than the government, to use more of your money. To utilize Gift Aid, you must include a declaration along with your donation.
You may choose to donate directly from your paycheque, which is called payroll giving. This option is tax-efficient and convenient. Payroll giving comes out of your pay before income tax, so you won’t be paying taxes on these contributions.
Choose Your Charity
Once you have clarified your goals, created a strategy, and considered how to give in a tax-efficient way, you are ready to choose your charity. With over 160,000 charities in the UK, this step can seem overwhelming.
There are various online resources available to help you with your search. Websites like The Charity Commission, Guide Star UK, and Charities Direct allow you to do an advanced search to find organisations that match your desires. Once you’ve narrowed your choices down, you can contact the organisations and ask them results-focused questions. Choose the charity that seems like it will make the most difference in an area that is significant to you.
Once you’ve completed these steps, you are on your way to becoming a philanthropist! Be sure to regularly assess your charitable giving and determine if you need to make changes. If not, continue doing what you’ve been doing. And be proud of yourself— you’re doing your part to make the world a better place.