At the end of the year, the difference between saving and giving might become a bit blurry. As tax time approaches, get the most out of making charitable donations and plan for the future with responsible investments for college or retirement.
Donate Used Items
Of course those unwanted holiday gifts and things-that-still-work-but-have-been-replaced should be donated to a charitable institution before the end of the year. You can pocket the tax receipt and feel good about that. But givers should beware, or be aware, of where their good will is going. Some for-profit thrift stores have agreements with non-profit organizations that translate into only a percentage of profits going to fight cancer, for example.
Other thrift stores accept donations but do not give IRS deductions and have nothing to do with charity. Better-known organizations such as Goodwill Industries and the Salvation Army utilize donations to create jobs and all profits go to fund their programs. Thrift stores operated by other non-profit agencies, such as the Humane Society, churches, or other local charities can also provide tax deductions.
Go Shopping, Give, Have Fun and Save
While dropping off donations, check out the merchandise. Popular high priced hoodies might be hiding on the bargain racks, along with cashmere and silk clothing, designer and high-end brand name shirts, dresses and jeans. Be sure to check for stains, torn seams, and non-functional zippers. If you know what to look for and have the time, thrift shops are a great way to save money. Typically, those located in affluent areas have better merchandise. Many accept returns and purchases do support a good cause, although you can’t take them off your taxes as charitable donations.
Consider Socially Responsible Investments
When making investments, be sure to read prospectus information and do not proceed until you understand the risks involved. That said, putting money away for college or retirement by the end of the year makes financial sense. Making your money work for you as well as for the things you believe in is possible, and it’s not necessary to be a billionaire like Bill Gates. Socially responsible investments have a mission to invest in companies that treat workers well, enhance the environment and have transparent relationships.
Shareholders influence corporate decisions by pressuring large companies to institute safe and responsible practices. They participate in global markets and also manage community investments, for example, Domini Social Investments’ money market provided funds for loans to those who are underserved by traditional banks, such as minority families and small businesses in Chicago.
Giving can be meaningful and investing does not have to support business practices that lack accountability. Everyone can make a difference in ways that don’t require huge commitments of time, energy or finances. All that is necessary is taking another look at time-tested strategies and re-thinking how to investors can plan together for a better future.
References:
Ventura County Reporter Online, “The Truth Behind Thrift Stores and Their Charities,” accessed 12/17/10
Domini Social Investments News Archives, “Environmental Stewardship Funded by Innovative Money Market Account,” accessed 12/18/10
Mary Earhart - Mary Earhart, RN, BSN, is a Licensed Midwife. She has written articles for professional journals and grants for non-profit agencies as ...
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