Buying Locally and Giving Locally: Maybe your charitable donations should stay in your zip code?

Buying Locally and Giving Locally: Maybe your charitable donations should stay in your zip code?

October 16, 2019

For many of us, buying locally matters. We’ve all heard the term and seen the signs: Shop Locally. Eat Locally. But let’s extend that thought for a minute: do you consider giving to your local charities?

The fact is we are bombarded with requests from worthwhile charitable causes. Many of these are well-known national or international organizations with sophisticated fund-raising efforts. Amid their appeals, requests from local charities may be easy to overlook. Yet many small organizations do a great deal of good in their hometowns.

Before you decide whether giving locally or nationally is a better option for your charitable donations, here are a few things to consider:

  1. No matter whether an organization is local or international, always check to see how much of the money it raises goes to administrative costs and how much actually reaches the people or causes the charity serves. Most charities have websites where this information is readily available.
  2. What kind of giving matters most to you? If you want to support the arts, chances are that a local organization, like your community theatre or concert association. will make great use of your funds. If you'd rather support agencies that help with natural disasters, an international organization is probably the most effective place for your money.
  3. Do you want to give actual items rather than money? If so, local charities usually are better choices. Many places, for example, use “angel trees” which are programs that provide gifts for needy children or the elderly. If you prefer to help the hungry with canned goods rather than cash, you may want to give to your local food bank or homeless shelter.
  4. Find out whether you can specify that your gift is used locally. Many national organizations like the Red Cross, Salvation Army or food banks are happy to receive gifts that are designated for your local chapter.
  5. Just as local government is closer to the people it serves, local charities may be more in touch with specific community needs. If you give locally, you can talk to people in charge and find out exactly where your money goes.
  6. Giving locally allows you to combine financial giving with hands-on service that may be more satisfying than just giving money. You could help serve meals at a shelter, pack gift boxes, volunteer at a food bank or distribute gifts.
  7. Just because a charity is local, however, don't automatically assume it uses its money wisely or efficiently. Always check. Sometimes, a small organization may be trying to duplicate what an older or larger organization can do more efficiently. Sometimes, local organizations are run by people who are well-meaning but don't necessarily have the skills or contacts to make the best use of donations. Do your homework.

Thoughts from a Financial Advisor

Remember that giving is an individual decision. Choose the level and type of giving that fits best for you, instead of trying to match what others do or give what someone else thinks you should.

Finally, keep a balanced perspective. There are many worthwhile organizations, and you can't possibly give to them all. Don't waste energy feeling guilty about the ones you skip. Instead, appreciate the giving you do in your own way, and let it add joy and satisfaction to your life.

Call me if you want to discuss further. 


Important Disclosures

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.

We suggest that you discuss your specific charitable donation tax issues with a qualified tax advisor.

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