For some the end of the year brings relief. For others it yields more pressure. It’s the final deadline for a lot of things in life: New Year’s resolutions, a last effort for good grades or possible promotion, and a hard cutoff to most things financial and tax related – including charitable giving.
While this rings true for many donors, it’s especially true for young givers. I can attest to the fact that as a young professional, my days always seem too busy to sit down and think about something seemingly non-essential as charitable giving, so it inevitably gets pushed to year’s end. Yet rushing to “get it done” not only can lead to poor decision-making, but practically guarantees a repeat of the same unnecessary cycle the following year. In either case, it’s not a great start to your philanthropic journey.
Getting Started, by Putting It Off
There is a way, however, to heed the call of the end of the year, but postpone your philanthropic decisions to a later date. Think of it as strategic procrastination.
You are committed to giving this year. You may already have the money set aside or will commit to charity a recently acquired holiday/year-end bonus. One consequence of the updated tax rules is a multi-year “clumping” or “bunching strategy.” Perhaps this applies to you as a means of minimizing Uncle Sam’s cut. No matter your situation, this workaround not only applies to immediate decision making, it’s also the smart path to take for your long-term giving.
So how is this possible?
Donor-advised funds (DAFs) are the charitable tool perfectly suited to benefit young givers who know they want to give now before the end of the year, but need more time deciding where they want those dollars to go. With a donor-advised fund, you can open your fund and make your contribution for tax purposes and year-end goals now, then take your time figuring out the when, where, and how to delegate those funds in the future.
Maybe you need that time to decide what issues you really care most about. Maybe you know what issue is central for you, but you aren’t sure who is doing good work in that field. Start giving now, without the pressure of giving to specific causes or institutions now. You’ll be achieving goals without compromising your principles.
It Pays to Wait
If you do know where you want to give, you can also jump in immediately using your DAF to simplify and streamline the process. Instead of having to sit there on New Year’s Eve frantically filling out credit card info online or running to the post office to mail your donations before December 31st, your DAF provider can handle all of the back-end actions to make sure your year-end gifts get to where they need to go. You can even automate your account going forward so you never have to punch in a number again! That newly freed-up time means you’ll be able to enjoy the end of the year knowing you are making smart choices.
But wait, there’s more! With a DAF, you can maximize your impact effortlessly. A benefit of all DAFs is that they invest the funds contributed into their client’s accounts. Quietly in the background that pot of charitable dollars is growing so that when the time comes you will have even more to give to the causes of your choice.
Room to Grow
With all of that extra time, you can learn more about being a strategic giver and build up skills for your philanthropy that will serve you throughout your entire life. But just because you have more time doesn’t mean you want to spend it all searching for charitable advice. With a DAF provider like Novus Society, you not only gain a donor-advised fund, but also pick up our team of philanthropic advisors, mentors from our parent organization DonorsTrust, and a community of peers who are in the same boat with you.
Needing more time to make those meaningful decisions doesn’t mean you are lazy or that you are somehow behind the curve when it comes to your peers. Joining Novus Society gives you a support system of like-mind individuals in similar stages of life with whom you can bounce off ideas or grow in philanthropic know-how. This learning is often packaged in the form of fun stuff like roundtables, dinners, happy hours, and entertaining e-news too.
So be proactive. Take the time you need by getting started with Novus Society, today.
This is the third instalment of our Consider Year-End Giving series. You can read the previous article here and the next article here.