Season of Giving: How to Make Charitable Donations Wisely

The holiday season is a time for spreading joy, love, and kindness. It's also a time when many of us feel compelled to give back to our communities and support causes we're passionate about. At Voyage, we believe the philosophy of "people helping people," extends beyond just financial assistance. It's about making a positive impact in the lives of others, especially during this season of giving.

We’re sharing how you can make charitable donations wisely, ensuring that your contributions align with your financial goals. All while making a meaningful difference in the lives of those you intend to help. 

1. Set a Budget for Charitable Giving

As you plan your holiday giving, it's essential to set a budget, just like you would for any other expense. Determine how much you can comfortably allocate to charitable donations without straining your finances. Setting a budget ensures that your giving aligns with your financial goals and prevents you from overextending yourself.

2. Identify Causes That Matter to You

Consider which causes or organizations resonate most with you. Whether it's supporting local shelters, providing meals for the less fortunate, or contributing to a global health crisis, choosing causes that align with your values will make your donations feel more meaningful.

At Voyage, we encourage our employees and members to get involved in causes that matter most to them. Our "people helping people" philosophy extends to supporting our community and beyond.

3. Research Charities and Nonprofits

Before making a donation, research the charities or nonprofits you're considering. Look for organizations that have a transparent track record, where a significant portion of funds goes directly to the cause rather than administrative overhead. Websites like Charity Navigator, GuideStar, and GiveWell can help you evaluate the effectiveness and transparency of charitable organizations. A couple of local Sioux Falls charities and nonprofits to look into are the Sioux Falls Area Community Foundation and the Helpline Center.

4. Consider Alternative Forms of Giving

Donating money isn't the only way to make a positive impact during the holiday season. Volunteering your time and skills can be just as valuable. Whether it's helping at a local food bank, participating in a community cleanup, or tutoring students, your time and expertise can make a significant difference.

5. Utilize Tax-Advantaged Giving Strategies

Explore tax-advantaged giving strategies that can maximize the impact of your charitable donations while benefiting your financial well-being. Donor-Advised Funds (DAFs) and Qualified Charitable Distributions (QCDs) from retirement accounts are excellent options to consider. Consult with a financial advisor to see which strategies align with your financial goals. According to NerdWallet, generally, you can deduct up to 60% of your adjusted gross income via charitable donations. However, depending on the type of contribution and the organization, you may be limited to 20%, 30% or 50%. 

6. Make a Plan for Year-Round Giving

While the holiday season often brings charitable giving to the forefront, remember that needs exist year-round. Consider creating a giving plan that spreads your donations throughout the year, ensuring consistent support for your chosen causes.

7. Share Your Giving Journey

By sharing your charitable giving experiences, you inspire others to get involved. Use social media or local community groups to tell your story and encourage others to join you in giving back.

Building Compassionate Communities

As we celebrate the season of giving, remember that charitable donations can be both a heartfelt act of kindness, as well as a strategic financial decision. By setting a budget, aligning with your values, researching organizations, and exploring tax-advantaged strategies, you can make a meaningful impact on your community while staying true to your financial goals.

At Voyage, we believe that "people helping people" extends to all aspects of life, including charitable giving. Let's make this holiday season one where we come together to support those in need and build stronger, more compassionate communities. Learn more about Voyage’s Community Involvement here.