How to Give Back Without Sacrificing Retirement Savings

Charitable contributions and acts of kindness provide many people with personal satisfaction and a life purpose. However, it is essential to remember that giving back should not jeopardize one’s financial stability. This article outlines practical strategies for making a meaningful impact without sacrificing retirement savings.

Volunteer

Some believe donating money is the only way to give back. However, charities and non-profit organizations frequently need volunteers more than anything else. One’s knowledge, experience, or skills may offer invaluable assistance to these organizations. For example, a retired accountant could help an underfunded local charity manage its funds more effectively. Volunteering is one way to significantly make an impact without compromising retirement savings.

Donate unwanted items

Another giving strategy is to donate unwanted items. Many people have clothing, furniture, electronics, books, and other items that are no longer needed or used. Rather than throwing them away, consider donating them to a charitable organization. Donating helps others in need and provides a tax deduction to the donor for the fair market value of the items.

Recurring donations

Understanding one’s financial situation, including retirement savings, is crucial before determining how much to give. One strategy to consider is allocating a predetermined fixed percentage of yearly income toward giving. Once the rate is determined, setting automatic recurring donations enables the donor to initiate a maximum monthly or annual amount through the charitable organization’s online giving portal.

Planned or Legacy Giving

Planned or legacy giving is another strategy for preparing to give later without prematurely depleting retirement savings. Sometimes referred to as gift planning or legacy giving, this approach involves including a non-profit organization in one’s estate plan. This giving may be in bequests like life insurance policies, retirement assets, or trusts. Planned giving offers potential tax benefits while supporting a chosen cause without compromising financial stability.

Employer-giving programs

Many companies offer matching donation programs, matching the employee’s charitable contribution up to a certain amount. Participating in a giving program is an excellent way to double the impact of your donation without additional costs.

In conclusion, while it’s noble to donate, it’s imperative to ensure it does not jeopardize financial confidence. One can give back without compromising retirement savings by volunteering, donating unneeded items, predetermining and automating recurring giving, and leveraging employer matching programs. Remember that every donation helps; even small amounts can make a significant difference.

4028539-1124d This information is provided as general information and is not intended to be specific financial guidance.  Before you make any decisions regarding your personal financial situation, you should consult a financial or tax professional to discuss your individual circumstances and objectives. 

Through the years, Threet Retirement has helped numerous people plan and prepare for retirement. We provide them with an income plan. We help them strategize when to take Social Security. We guide them to help reduce the amount of taxes on that income, and much more. Contact us today to get started.