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Charitable Giving on any Budget

Charitable Giving on any Budget

By Carla Hindman, Director of Financial Literacy, Visa Canada

If you've ever wondered if you could be charitable with only a few extra dollars in your wallet or a little bit of free time, the answer is yes. You just have to get a little creative and savvy with your finances.

Getting the most bang for your buck is a badge of honour these days, whether you're car shopping, choosing a university or just comparing loaves of bread. One area where you really don't want to misspend your hard-earned dollars is charitable donations.

There are no shortage of non-profit organizations competing for contributions, but quality and effectiveness vary significantly, so you should do a little research before donating your time or money. Here are a few suggestions.

Pick the cause that's right for you. Many people choose to support organizations that champion issues close to their heart, whether it's feeding the hungry, environmental protection or working to cure a disease. Also, consider whether you want to target local organizations or prefer to have a more national or global impact.

Do your homework. In these tough times, many non-profits are experiencing increased demand for their services in the face of declining contributions and government funding. Look into the charity's spending – ideally, at least 75 per cent of contributions should go directly to beneficiary programs.

You can read about different charities' breakdown of funds either in their own annual reports, or by searching online. You can also try the Better Business Bureau (www.bbb.org/canada), which rates whether organizations have met its standards of accountability, including ethical conduct and honest solicitation practices.

Check your finances first. Before you start distributing your dollars, check your budget to determine how much you can afford to donate. One approach is to designate a set amount per month, and set up automatic payments.

Be tax-smart. Although your kids' baseball team may be a worthy cause, be aware that only contributions made to registered charitable organizations qualify for tax deductions. While you probably aren't making donations in order to get a tax receipt, it's best to know in advance if your contribution qualifies or not. The Canada Revenue Agency maintains a searchable list of Canadian charities called the Charities Listings (www.cra-arc.gc.ca/charitylists/), which can be used to confirm whether a charity is eligible to issue official donation receipts.

Make your money go further. Many companies offer donation matching for their employees. Investigate whether your employer offers such a program; it's a great way to make your dollars go even further.

Be on fraud alert. Unfortunately, some unscrupulous people and organizations may try to take advantage of your desire to help others – if you let them. A few tips:

  • Be suspicious of telemarketing and email solicitations. When in doubt, contact the organization yourself to verify the request.
  • Be aware that scammers often choose names that are similar to those of legitimate organizations.
  • Never give out personal or credit card information unless you initiate the contact.

Go micro. If you can only find a few dollars to give, don't let that discourage you. Organize like-minded friends and family members to pool funds, attend events or volunteer your time for a cause, or consider a particular nonprofit's organized crowdfunding efforts that will allow you to make an impact with only a few dollars. Still short on cash and want to help? Pick up the phone or email the charity and ask if they accept small items or in-kind services. Some ideas might include gift cards (including ones with unused balances), office supplies, stamps, catering for events or board meetings or help with writing, fundraising or technology.

Bottom Line: More people than ever need our charitable assistance. Just be sure you're contributing to organizations that can do the most good.





This article is intended to provide general information and should not be considered legal, tax or financial advice. It's always a good idea to consult a tax or financial advisor for specific information on how certain laws apply to your situation and about your individual financial situation.

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