Practical Giving - P3
Technology advancement has significantly increased the available methods of giving. Today we can donate to organizations in so many ways that at times it becomes difficult to determine which way is the one to choose. Is donating online better than giving in person? Is cash or check better than on a credit or debit card? Should I give each month or should I set up automated giving?
Well, there is likely no right or wrong answer on this matter. There certainly are some opinions, and we are willing to share ours. Below we outline the types of giving available and their impact on donor and recipient. We hope that this list will give you insight into what type of giving method works best for you according to the opportunity presented.
Volunteering is a donation of time. It is giving time out of your life directly to the organization or cause to which you donate your volunteer hours. This is often the most personal donation that you can make. Volunteering also provides the donor the greatest level of exposure to the recipient. Whether it is an individual, a family, a religious organization or any other type of organization, the volunteer will see the impact of the donation directly and in person.
Suggested Use: Volunteer when you have the time to donate and when you truly want to know what your donation will accomplish.
Cash / Check / Direct Deposit Donation -
Welcome to old school donating. A donation made in cash or check is considered your parents’ way to give. That being said, a check or cash donation is still just as valuable as any other way of donating. It just may take a little longer to get there. Also, since most online methods of donating incur merchant charges, the old school way often results in the organization receiving more of the funds. Donating via check or direct deposit is suggested when making larger donations.
Suggested Use: Donate in Cash, Check or Direct Deposit when the time is not of the essence of the donation or when a personal visit onsite is an option. Also, use this format when you wish to eliminate any potential fees associated with processing from the bank.
Online / Credit Card / Debit Card Donation -
Because most organizations now have websites or other online avenues for donating, this is becoming the most used method of making contributions. Online donating is fast and easy. Whether using a credit card or a debit card, donating online is the same as any online purchase transaction. The donor provides the necessary information and pushes a button to submit their gift. This form of donation can often be automated as well. If you want to give every month, the organization’s e-commerce system will provide the option to choose the frequency of giving and the amount. Hit submit, and the amount will be donated according to your wishes.
Suggested Use: Use online donations when the organization makes such methods available and when you wish to set up recurring donations in the most convenient way.
Property / Stock Donation -
This form of donation is used mainly for tax planning purposes. When an individual of high wealth has appreciated the value in a particular piece of property or marketable stock, they may choose to donate that property to get maximum tax-deductible value out of the donation. This is smart planning with regards to the individual’s taxes and also provides the recipient with potentially appreciable assets. In most instances, the organization receiving the donation will immediately liquidate the asset making the appreciating aspect of the donation unimportant. Note that these types of donations can be difficult for some organizations to deal with since access to trading methods may be limited and expertise on how to deal with the assets is likely not available within the organization itself.
Suggested Use: Consult your financial planner and accountant when considering this type of donation. Also, talk with the organization to which you plan to donate before gifting property. Use this method in connection with appreciate assets and when tax consideration applies.
Charitable Bequest Donation -
This type of donation is connected with the death of the donor. A bequest is written into the donor’s will to arrange for the donation of a specified amount to be given to the organization of the decedent's choosing. A Charitable Bequest is a great way to give to an organization you truly trust but remember that it depends on your death. So the timing of such a donation is most often unknown. If you truly wish to give to the organization, it may be better to make the gift while you are alive.
Suggested Use: Give with a Charitable Bequest when you have assets that you wish to dispose of in your estate in a charitable manner. Use this format with larger donations or with particular amounts that are committed to organizations you trust.