A personal blog about life, business and money – not to be regarded as Financial Advice
We all want to give something back. We want to support those charities close to our hearts; to make a difference in the world (however small) and feel like it matters.
But it’s hard. Can you really afford to give anything away – especially if you’re not yet achieving the level of financial success you want? If you’ve got a big mortgage or a growing family? And even then, how to do it best?
Well – let’s start with the technical details.
First off, giving via Gift Aid is tax efficient. It both increases the value of your donation AND reduces your tax bill.
I won’t go into details, because we’ve talked about Gift Aid in detail here in a previous blog.
But briefly, when you donate through the Gift Aid scheme, your gift is paid net of basic-rate tax (20%). So the charity you care about can then reclaim an additional 20% of your donation from HMRC.
If you’re a higher-rate 40% taxpayer, you can claim the additional 20% relief too.
It’s how many well-known public figures and companies give millions away each year, both saving a massive amount of tax and contributing to a cause they’re passionate about.
And it’s easy to do. So real win-win!
But what I really wanted to talk about in this week’s blog is the mindset of charitable giving. And how – if helping others matters to you too – you can start with tiny steps, right now.
We all grew up with stories about money. And more often than not, those stories were negative.
We inherited our money beliefs, handed down through the generations of our family. Like:
- Money doesn’t grow on trees.
- Money is hard to earn.
- Money is the root of all evil.
- You have to leave your family to make money.
- That ‘rich’ people are to be scorned, ridiculed and called names (and thus if YOU get ‘rich’, people won’t like you anymore).
Maybe you grew up with money being scarce, hearing your parents fight because there was never enough.
Often, we’re not even aware that these money stories have shaped our relationships with money as adults. But they DO.
In truth, there is no shortage of money in this world. And when you shift from a scarcity mindset to one of abundance, the way you see charitable giving starts to shift too.
However you grew up, it IS safe to give money away (and it feels amazing!). When you start focusing on what you have financially instead of what you lack, you realise you have plenty. And that more money is always on the way.
Gratitude is a great way to start making this mindset shift. What do you already have? Do you track the money that comes into your life (in all the various forms, from your earnings to gifts and interest paid by your bank) – or just what goes out?
Even if you have consumer debt and feel like it weighs you down, you can make small mindset shifts to feel more abundant.
When you make your monthly credit card payments, for example, focus on the balance available to you going UP. Even if you never plan to spend it, focusing on the money available to you shifts your mindset to one of abundance, rather than the scarcity mindset of seeing only the negative balance you still have left to pay.
Why does it matter? Because when you start to notice and feel grateful for all the financial abundance in your life, you start to see more of the good in the world. You feel better. And you start to want to make the world a better place, too.
So what can YOU do to start giving, right now?
We’ve all heard of famous people who give 1/3 of their income to charity each month; save 1/3 and spend 1/3.
Which is amazing, generous and inspirational – but in truth, not very helpful! Because you don’t need to be a big celebrity or earning millions to start making a difference.
Even if your own personal or business financial targets still feel some way off, you can start small. Right now.
Choose a set % that you’ll donate to the charity closest to your heart every month.
Personally, I do 5%, but some philanthropists I know give up to 30%.
Even 1% is a start.
It may seem like a tiny amount (even hardly worth bothering). But what it WILL do is help you change your mindset. Instead of thinking ‘I can’t afford it’, you’ll see your donations stack up over time. And every month, you feel that little moment of satisfaction, knowing you’re making a difference in the world.
Because if you can’t give 1% of £1500 now (£15), how will you EVER want to give 1% of £1million?
And don’t forget – if I can help you with organising your finances, maximising your donations and planning for your secure financial future – I’d love to help. Just click here now to get in touch!
Until next time,