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As far as my email inbox goes, the week of Thanksgiving was pretty bad, as every online shop to which I have ever given my email address — and a few besides — sent me message after message about sales, just for Black Friday! Or the weekend! Or just Cyber Monday!
I wondered just how much of my time was spent deleting the sale messages. But what I’m really bracing for is December 26, which may be the charity black day. “Give!” the message goes. “Just in time for your taxes!”
Creating a sense of urgency
Even though many non-profit organizations operate on a June 30 fiscal year, I get what they’re doing: they’re creating a sense of urgency. “Get your contribution in by December 31st, ” says everyone, even though 70% of Americans don’t itemize deductions on their taxes at all.
And it’s likely that you know you won’t itemize your deductions, and yet you’re still swayed by the messages. My theory is that you get caught up in the rush to get your gift in, even though you know it doesn’t really matter. Will your favorite charities use the money any differently if it arrives on December 31st or January 12th? Will they have any penalty because they received the money after the calender turned over? Probably not on both counts.
I polled my friends on Facebook. I have friends in all income brackets and all sorts of professions, from just-scraping-by freelancers to government employees to professionals who make six figures, and of the 12 people who responded, only one even cared a bit for the tax deduction.
Most of my friends confessed to forgetting or losing receipts, or not having anything else to deduct. All of them said the cause was what mattered, not the tax benefit (and, for the record, not the swag — evidently I’m the only one swayed by swag).
But, get your gift in by December 31st!
All the personal finance gurus will tell you in early December not to forget to get those donations donated. Tax benefits of these and a dozen other things are enumerated. And these are all great ideas, but I often wonder if that rush to judgment on tax-deductible gifts doesn’t create some less-than-optimal financial behavior.
And it’s not just the end of the year; many organizations are looking to take advantage of the spirit of giving starting before Thanksgiving, soliciting donations for non-profits focused around hunger. While hunger any time of year is presumably bad, during the holidays it’s the sort of problem we all feel is our problem.
Messages to give are everywhere, from “give guides” in local magazines and newspapers to the heart-wrenching stories of community members in need published by local newspapers and broadcast on local TV stations. I’ve been noticing more and more online “events” and blog pages set up for holiday giving, from individuals raising money for organizations they care about to one event meant to have Americans give to help Africans get clean water, instead of putting little things in stockings.
Thanks to the “spirit of the season, ” I’m more likely to stop and let a fundraiser on the street pitch me. The days leading up to Thanksgiving, greeters at grocery stores were handing out cards encouraging shoppers to give at the checkstand.
Guilt, generosity, and tax benefits
While I should know better, I still fall into that trap. I gave $10 to the Southern Poverty Law Center on the street the other day, persuaded to give (a little) money I couldn’t really afford to a cause I believed in — and which had been sending me appeals all year. I thought to myself, “but, taxes, at least!” as I handed over my money, regretting it even then.
A colleague on a non-profit board has been urging me to get a substantial gift in before December 31st, for show, really, not for any practical reason. But I’m trying! I want to give money for African water, but really, I’ll still get the stocking stuffers.
So should you give?
For the most-of-us who don’t itemize deductions, I think you should look at end-of-year giving in one of two ways (which one will depend entirely on your personality):
1. End-of-year giving is good for budgeting. If you are organized and unswayed by emotion, I think December giving is great. It gives you the opportunity to plan gifts and make your time spent on donations efficient. Calls the rest of the year can be neatly avoided; “I give in December.” Appeals can go in the recycling unopened. You can budget your money and parcel it out all at once to make the relative amounts work out according to how much you value the organization, not who is the loudest. And if you are into swag, lots of organizations give back special gifts in late November and December.
2. End-of-year giving is not good for the easily manipulated. (In other words, me.) If you’re a pushover like me, just say no! Tell yourself that it doesn’t matter when you give, so you can wait until you get a bonus or a tax return or some other pay day. Make a note and stick it on your computer, “I don’t itemize.” That way when the emails come in you will not rush to get the donation in before the deadline! You can remember, simply, this is not going to give me any benefit but lots of mail all year.
And, maybe some swag.