We only have a limited amount of time on this wonderful Earth, and there are almost countless people around the globe who have far fewer opportunities for a pleasant life than we have. Thus, it’s natural for most people to eventually come to the conclusion that it’s quite important to share the wealth we’ve earned by sharing the resources we have with those that are less privileged in life. If we have an excess of resources while another person doesn’t have enough resources, it makes sense to share those resources.

When we cast our bread upon the waters, we can presume that someone downstream whose face we will never know will benefit from our action, as we who are downstream from another will profit from that grantor’s gift.
- Maya Angelou

Giving Now

Many people argue on behalf of giving money now. I disagree - one should never give money to charity if it endangers their long term financial future. There, I said it.

If you give money to a charity, especially amounts large enough to put your own financial future at risk, you risk having to line up and take back charity money for yourself later on. You’re far better off making your financial ship very sturdy - but that doesn’t mean rampant consumerism is okay. It means pay off your debts and build some long term financial security and independence, so that you’re never at risk of having to eat charitable money yourself.

That doesn’t mean you do not have gifts that you can give. Give your time. Give your talents. Give your youthful energy. Devote a few evenings and a weekend each month to working for a charitable group, giving them your ideas, your energy, and your effort to make sure that the group’s work is done. It doesn’t matter what charity you work for - just find one that can utilize your skills and makes sense to your own personal values.

Giving Later

Andrew Carnegie, in his famous essay Wealth, argues on behalf of giving later:

Individualism will continue, but the millionaire will be but a trustee for the poor; intrusted for a season with a great part of the increased wealth of the community, but administering it for the community far better than it could or would have done for itself. The best minds will thus have reached a stage in the development of the race iii which it is clearly seen that there is no mode of disposing of surplus wealth creditable to thoughtful and earnest men into whose hands it flows save by using it year by year for the general good.

In other words, the people who are already rich know how to accumulate wealth, and their best gift to charities is to keep using this knowledge to accumulate more wealth if, in the end, it is eventually bequeathed to the needy.

This philosophy is derided by many as being greedy, but I don’t see it that way. I think Carnegie is actually quite right, and I think he’s basically voicing the exact same philosophy that Bill Gates and Warren Buffett are espousing with the Gates Foundation.

To put it simply, if you have a gift for acquiring wealth, but you need those financial resources to earn more wealth, then you should not just sign over all of your assets to a charity while you can still use that gift. Instead, plan to bequeath what you have to charity once you can no longer use your gifts - in your dotage or after your passing. Alternately, you can devote time and money by bequeathing a large portion of your wealth to a charity then agreeing to serve as that organization’s treasurer, putting your wealth-building skills to work.

To me, this is charity in its purest form - people using their gifts, both monetary and non-monetary, to help charities.

Giving Both

My belief is largely this: give time now, give money later.

Early in life, the resource you have huge amounts of is time, not money. Thus, it makes sense for a young person to give their extra time to charitable work. Find a charity you actually agree with and spend some weekends and week nights working for them. Maybe you can volunteer to coach the community Little League team, or perhaps you can help hand out food at the food pantry. Maybe there are local committees that could use your input and attention, like a church council or a local school board or a political campaign.

On the flip side, younger people often don’t have as much money. They might be working at well-paying jobs, but they’re often facing huge debts from student loans and mortgages, and they also need to financially plan for their old age. Many are also loaded down with children who also eat into the pie and also need some planning for their future.

On the other hand, later in life, time is shorter. You might not be working and you might still be able to give your time and talents to charities, but you don’t have the youthful vitality of others. Often, your role is teaching others how to hold the reins.

However, late in life is when many people have the most wealth. It’s also the time when you can be setting up bequeathal plans, giving much of that accumulated wealth to people who may need it, both when you’re alive and after you pass.

Because of that, I generally believe that earlier in life, your time is your best gift, not your money. Your time can be used to provide all sorts of services, and your youthful vitality makes that time quite valuable, because most volunteer work really thrives on energy and focus. Take your money and do sensible things with it, ensuring that your family doesn’t have to use the charities, now or later.

Later in life, use that experience in both time spent volunteering and money saved to allocate some financial gifts. You’ll have a very good idea of good places for your money to go, plus you’ll have the experience to hand over the reins of your volunteer work to others in a sensible fashion.

Obviously, there’s no reason not to give a surplus of money now, nor no reason not to give a surplus of time later. The key is to look at what you have in terms of both money and time and give what makes the most sense, but never forget to give. There are many, many people not just in your community but in the world as a whole who could benefit from your help.

As I write this, Iowa is suffering through incredibly disastrous flooding. Levees have been breached in Des Moines, and Cedar Rapids is nearly underwater. If you want to see how bad things are right now, the best place to watch is KCRG-TV in Cedar Rapids, which has had amazing coverage of the events around here. Even worse, the water is flowing downstream, breaking levees all throughout Iowa and Illinois, and likely causing flooding of countless homes over the next week and a half.

Over the last forty eight hours, many people have sent me emails and messages asking what they can do to help. Many people see news like this on television, feel some pity for the people involved, but think there’s no way they can really help the situation. While it would be wonderful to have hundreds of thousands of people come to the area to help with sandbagging efforts, that’s only one way you can lend a helping hand to people in disastrous situations like this. You can help, wherever you are, when disasters like this strike. Here are seven things you can do right now to help out with this (or with any major disaster that may occur later).

Donate money to the American Red Cross In 1993, when the Mississippi River floods of that year wiped out my hometown, the American Red Cross was incredibly helpful to everyone in the town. Before the flooding, when the sandbagging was ongoing, they came to town with food and beverages for people volunteering to help sandbag, keeping us cool and strong. During those crucial hours after the levees broke, providing food, water, and assistance to everyone who needed it. Services like this don’t run on magic - they need your help. Kicking even a small $5 donation towards the American Red Cross can help immensely during any domestic disaster. Use the American Red Cross donation form and select “Where the Need Is Greatest.” Even a dollar can help get a bottle of clean drinking water to someone in Cedar Rapids, where there is no potable water.

Put your unused leave to good use Many large workplaces, like the federal government, allow people to give unused leave to others. Contact your HR representative and ask if you can donate some of your unused leave to people affected by the flood.

Donate blood to the American Red Cross, too If there’s a blood drive in your area, stop in and donate blood. When fighting floods, people can get injured badly by unexpected levee breaks and rushing water. Sufficient blood supplies are important. Here’s information on blood donation for the American Red Cross.

Donate unwanted items such as clothing, blankets, bedding, and so on to the Salvation Army After the flood waters began to recede, our town received huge bundles of donations from the Salvation Army - clothes, blankets, and so forth. These items helped many people start to recover from the disaster. If you have some old shirts and pants, some old blankets, or other bedding, drop them off at your local Salvation Army office and ask that they be given to flood relief (or another specific crisis).

Donate bottled beverages, soap, shampoo, etc. to a local church. You can also contact your local church and see if they can point you in the direction of any larger efforts - many church diocese and synods send large trucks of donated goods to disaster areas.

If you’re a spiritual person, include the flood victims in your prayers. Many people rely on their faith to handle disastrous situations. You can help with that by including victims of the flood (and other disasters) in your prayers. Even just a few moments of serious reflection and contemplation of their situation can be a powerful thing, because putting yourself in someone else’s shoes subtly changes not only your perspective, but can also affect their situation, too, as a result of any choices you make because of that contemplation. Pray and/or reflect for a moment on the flood situation, and react with your heart.

Consider National Guard usage when you vote - or get politically involved. When disasters like these floods and Katrina occur, they’re often made worse by a National Guard that’s stretched too thin with overseas deployments. Consider that issue when voting - we need a sufficient National Guard here at home to help out with disaster situations.

The real key is to just find what you have on hand and can easily give. A water bottle and a dollar bill can make a huge difference to someone out there.

Each year at Christmastime, I identify a particular charity that fills an important need in a community. I usually choose one that I have a personal connection to, having visited the facility and/or have had a close friend or family member working there, and the charity must be in line with my personal values of helping people who truly need help. If you wish to give a Christmas gift to charity this year, I truly hope you’ll consider this group.

L’arche Tahoma Hope is a small group of four homes in the Tacoma, Washington area. These homes open their doors to adults with mental development disorders, providing them a place to live in a communal environment with their peers and with a staff that lives on-site with them. A typical home consists of four to ten people - assistants plus “core members,” where core members refers to the developmentally challenged individuals living there.

I’ve personally visited one of these homes. The one I visited had six developmentally disabled individuals living there, along with five assistants. At any given time during waking hours, two to three of those assistants were always involved with working with the core members.

What did they do? The home had a very large garden, and the assistants and core members all worked together as a group in that garden, raising vegetables and flowers that they would either consume themselves or sell to the public as a fundraiser. The more technical tasks were performed by the assistants and they also provided a lot of emotional support and friendship to the core members, who were largely involved with picking the vegetables and weeding and such.

The group also made paper mache flower pots for the plants out of flour, colored water, and newspaper. These actually turned out quite well, and if it were not for the fact that I was thousands of miles from home, I would have purchased one for myself.

At meal times, all of the core members and all of the assistants that were present would eat together around a large table as a group, sharing food and talking about their day.

I will be the first to admit that I do not have the spiritual fortitude or patience to do this job. I simply could not live there with the patience required day in and day out, and I am deeply thankful that there are people out there who do have that kind of patience and caring for others.

The truth is that most people don’t have that level of patience and most families do not have the support structure that is needed to provide for individuals with mental development disorders. For the most part, these individuals come from loving families who simply recognize that they don’t have the patience or the ability to truly care for them.

These homes provide a quality of life for individuals with mental development disorders that they simply could not find anywhere else in the world. They’re in an environment with their peers, where they’re not seen as outcasts, and with individuals who care enough about their situation to wish to live there and help them in many one-on-one situations.

I know that if I had a child with similar disabilities, I would truly hope that in adulthood, they could find a situation like L’arche to live in, and I am truly thankful that such places do exist and that there are people out there with enough spiritual and mental strength to work and live there, making a better life for people who weren’t given the same tools and abilities we were given at birth.

If you’re thinking of making a charitable donation this year for Christmas, please consider donating to L’arche Tahoma Hope Community. Take some time to visit their website and find out more about the amazing and life-transforming work that goes on there.

Furthermore, I will match all donations by my readers, dollar for dollar, up to $1,000 between now and December 25, 2007. All you have to do is donate to L’arche Tahoma Hope Community via JustGive.org and then forward the receipt of your donation to me - you can delete any personal information from this receipt if you wish. So, if you donate $20 to L’arche Tahoma Hope this year, I’ll match it and that gift becomes $40, and so on.

If you’d like, you can read about my 2006 charity drive for the Child Abuse Prevention Center of Dallas County, Texas.

Recently, my wife and I took account of all of our charitable spending. Over the last year, we’ve donated small amounts ($10-$50) to many different charities, a list that was almost shocking in length when we finally examined all of them together. Our total charitable spending was an amount we were comfortable with, but we wondered to ourselves whether or not one large donation to one charity we both cared about and were sure was a legitimate and healthy charity.

One big reason why we feel that the small donations are fine is that most charities are based on a model of receiving a lot of small donations. Their organizations assume - and operate - on the basis that there will be many out there like me and my wife,

Another benefit of the small donations is that we can support a lot of organizations that we believe in. There are many, many charities and organizations out there that we believe in and agree with the concept behind, and thus there are many that we have interest in supporting financially.

Even given those ideas, however, we’re leaning towards reducing the number of our charitable donations significantly in the coming year (down to just a very tiny handful), and donating much larger amounts to these charities. Here’s why.

The charities that we are most strongly tied to are either highly local or tied closely to our family. These charities are extremely involved on the local level, facilitating positive social work in the community itself instead of on a broader scale. They provide the opportunity for us to directly witness our dollars at work, as well as donate our own time if we so wish.

These charities tend to be much smaller than other charities. In one case, it is an organization that provides fulfilling living conditions for physically and mentally handicapped people in a specific community. In another case, a small, independent food pantry that provides food to people below certain incomes that actually work for a living - they target minimum wage earners with families, mostly, and provide them quite a bit of free, fresh food. In both cases, the organizational structure behind each of these is small.

These charities also enable us (and very close relatives of ours) to directly donate time and talent, as well. In every case, the charities are local enough that my wife and I - or members of our immediate families - can directly volunteer or work for these groups. This means that we have the clear opportunity to do even more than before - and spend our volunteer time and money working for the same goals.

In my eyes, the benefit of supporting local charities is the greatest of all because you can directly witness their good work - and even participate with your own effort quite easily. Because of this, our charitable donations next year will be much larger and focused on small organizations within communities where my family and I can potentially not just make a financial contribution, but a personal one as well.

I guess, in the end, Your Money or Your Life had a broader impact on me than I would have ever guessed.

While writing about personal finance and personal development books, several people have written in to ask me to write about Rick Warren’s The Purpose Driven Life and especially Joel Osteen’s Your Best Life Now. In case you’ve been living under a rock for the last several years, Warren and Osteen are charismatic Christian evangelists with enormous congregations that put a particular emphasis on applying pieces of Biblical scripture to modern life rather than trying to push modern life onto a scripture framework.

I’ve chosen not to review these books for various reasons (mostly because I’m not too interested in reiterating someone else’s Christian preaching), but the popularity of these books and the messages that they carry do bring forth a very interesting point: what role does spirituality play in personal finance?

Most organized faiths have some variation on the idea in Matthew 6:24, which states that a person cannot serve both God and money. On one level, this idea makes a lot of sense - if the center of your life is financial gain, then that means that spirituality is not the center of your life.

On the other hand, if spirituality is at the center of your life, you should be spending your time doing what will produce the greatest spiritual good within yourself and within the world. What does that require? For some, it might be volunteerism; for others, it might be a life of spiritual leadership.

When thinking of this, I picture close friends of mine who have chosen this volunteer work or other social work for their lives. They all believe that they can do more for the world by working in situations where their efforts can directly be seen. Most of them are quite poor; they work in shelters or they work as a pastor at a small church or in child care.

On the other hand, look at the Bill and Melinda Gates Foundation. Bill Gates is the definition of capitalist - Microsoft’s strategies have been dissected over and over again. Yet what does he do with that wealth he has accumulated? He gives it away, enabling things that were basically impossible before his foundation appeared on the scene. He found another path to the same goal: helping the world.

Most of us are between these two extremes. We work at jobs that are much more financially lucrative than that of the volunteer, but almost none of us can hope to achieve those huge levels of wealth. Yet by our efforts, we can make a huge difference, too. Let’s say I were to set aside 10% of my income for the year for charitable giving, or all income over a certain limit. This could at least partially fund a social worker’s job - because of your giving, someone could spend their day making a difference in the world. Thus, someone with marketable skills that don’t translate well to public service can still give a great deal spiritually.

Similarly, a person may in fact choose to not give at all during their lifetime, instead amassing a large sum of money that, in their late years, could help fund a major public initiative of some sort - the Andrew Carnegie model without the self-naming hubris. If one spends their life working hard, making very good money, investing that money, and living frugally so that they can endow $10 million at the end of their life to endow a school in a very poor country, did they not live their life with spirituality at the center?

Different people have different talents and different ways to give of themselves. What matters is that you actually do give, whether it be working hard so that you can make a donation to help a cause or directly working for that cause. What matters is that you put your talents to work in the end for a cause that is important to you. To me, that’s what a spiritual life is all about.

When I showed my sister-in-law The Simple Dollar, her first comment was, “You talk a lot on here about ways to make and save money. Do you really talk about how to spend it in a spiritually fulfilling fashion?” It was a question that actually made me think quite a bit. I do talk about ways to spend money on here, but it’s mostly towards things that enable more self-reliance and thus over the long run financial savings.

While ruminating on this issue, I came across The Soul of Money by Lynne Twist at the library and I realized this book covered the exact thing that my sister-in-law was talking about. The pitch line on the back cover spelled it out: “In a consumer society that glorifies the pitch, the sale, and the insatiable appetite for more as a measure of self-worth, The Soul of Money asks us to step back, to examine our relationship with money, to assess our connection with core human values, and to change this relationship and, in so doing, to transform our lives.”

Thus, this book focuses in on ensuring that the ways we use our money are in line with the core values we hold in our lives. Before I even started reading the book (I let it sit on my dresser for a few weeks before cracking the cover), I spent some time thinking about my core values, and I realized that the small-scale value that is strongest to me is my family and the large-scale value to me is energy and nutritional independence. What could this book teach me about my own finances and how they relate to those two values?

Looking Deep Into The Soul of Money

Chapter 1 - Money and Me, Money and Us
The book opens with what could best be described as an introductory chapter, outlining how many people separate their soulful life (the one centered around their values) and their financial life (the one centered around their money). Within each world, they behave differently: the soulful life is usually full of following the things that really matter, being fair to others, and so on, while the financial life is full of greediness and petty behavior. But why does this dichotomy have to exist? Why can’t the soulful side be on the same page as the financial side?

The example of this that really struck home for me was when the author described their early marriage and how they handled children. Their soulful life told them that the children were the center of everything, but they spent almost all their time focused on their financial lives: buying expensive art, buying wines, going on fabulous skiing vacations, optimizing their careers, and so on, but in doing this they found themselves missing out on their child’s first steps and first words and such. They provided financially, but they didn’t provide emotionally, and thus their financial lives won out, for better or worse.

Chapter 2 - Into India: Heart of Hunger, Soul of Money
Money alone does not guarantee a fulfilling life, and a lack of money doesn’t guarantee an empty life. So why do people associate money with fulfillment? The real truth is that there is a disconnect between the two, and that gap creates most of the pain that people feel when it comes to a sense of not having enough money - or enough of any material good - and also from the sense of “selling out.”

The truth is that it doesn’t matter whether you’re rich or poor, you still have the capacity to make decisions that don’t truly reflect your ideals, and it is those repeated wrong decisions that leave people feeling empty and hollow. I liken this dichotomy to a recent choice I made: I was basically confronted with a direct choice between making money/focusing on my professional goals or following my values, and I followed my values. What happened? A truth was revealed to me, and it enabled me to actually accomplish both by letting my values lead.

Chapter 3 - Scarcity: The Great Lie
Most people have an innate sense that there is simply not enough: that explains not only why they are always striving to get a bigger piece of the pie, but why some people suffer in poverty and hunger. However, basic analysis of the situation shows that there is more than enough food to feed the world - and more than enough stuff in your life to bring happiness.

The myth of scarcity breaks down into three parts. First, the idea that there simply isn’t enough is a myth that we use to delude ourselves into believing that there is a “pie” of a certain size that can’t grow any larger and that if we don’t grab a bigger slice of it, someone else will. Second, the idea that more is better causes us to always grab for that bigger piece of pie, even to the exclusion of others. Third, the concept that this is just the way things are gives us a very weak excuse to act greedy. The truth? All of these are complete myths - there is abundant resources for all and the only reason to grab more and more and more is greed; we use these myths to justify greed.

Chapter 4 - Sufficiency: The Surprising Truth
The book tries here to make a clear distinction between the idea of “enough” and the idea of “abundance.” Most people strive for abundance, but the truth is that abundance means that you always have more than you actually need, and acting on this basis means that in fact you are denying things to others in order to create an overflow for yourself.

A much better target is “enough;” find the things that make you fulfilled and then use the overflow from that to make the world a better place. For me, this means that I should find the point where my work effort produces what my family needs, then spend the rest of the time chasing my values: raising my children well and working on alternative energy causes. Interestingly, this concept works hand in hand with the concepts in Your Money or Your Life (which I highly recommend).

Chapter 5 - Money Is Like Water
I found this chapter quite interesting. Many people (myself included) keep track of their net worth and strive to increase it each month or each quarter, a reasonable goal if you want to create a state of financial self-reliance. This chapter argues that once your net worth reaches a point of comfort for yourself, you should strive for zero growth in your net worth.

This seemed pretty strange to me at first, but as I read on, it made more sense. The author doesn’t mean that you should begin to spend like mad, but that you should take that growth in your net worth and apply it towards causes and values that are important to you. Let’s say, for example, that my child is considering a life of volunteer work for a cause that I also believe in; I could take that abundance in my net worth to buy my child a home to live in and pay the taxes on it while my child focuses on working for an organization. Or, I could use that extra money to start an “X-Prize”-like organization awarded to a group that designs a non-emission car that runs on something that could be produced domestically (a fully developed hydrogen car, for example). Once I reach the point of having “enough,” these doors open to me and become fulfilling things to do with my money.

Chapter 6 - What You Appreciate Appreciates
Just like an investment appreciates over time because of the dollars invested in it, anything of value appreciates over time in relation to the amount of attention you pay to it. Thus, take a look at what you spend your time focusing on in a given week. These are the things in your life that you are truly trying to grow; the other things are being left to wilt. Keep a log, if you want, of the time that you spend focused on various areas of your life: your career, your family, your interests, and so on.

The easy answer here is that there isn’t enough time in a day to give proper attention to the things that you want to give attention to. What that actually means is that you’re not allocating your time in a way that matches your values, and for many of us, that means you’re spending too much time focusing on your career and money-making motives and not enough time on the other things that are important to you.

Chapter 7 - Collaboration Creates Prosperity
The main thesis of this chapter seems to get lost in the shuffle of anecdotes. The general idea of working together and sharing skills seems to come through, but how does this apply to the thesis of the book?

It didn’t become clear until the end of the chapter, and it can best be summarized with the old adage give a man a fish and he’ll eat for a day; teach a man to fish and he’ll eat forever. In other words, the best gift we can usually give is sharing our skill and our time and not our money, particularly when we can use that skill to teach others how to walk for themselves or make it possible for them to do so.

Chapter 8 - Change the Dream
The “dream” referred to here is the social dream, using Martin Luther King Jr.’s “I have a dream” speech as an example. What sort of social change do you dream about? Instead of taking the excess in your life and spending it on a $200 pair of pants, why not apply that money towards creating that social change?

Your dreams can only result in change if you realize that they’re more than just dreams - they’re goals that you can actively work towards with your time, your money, and your passion. Dr. King didn’t make it to Washington to give his speech without time, money, and passion, but because he provided all three, he changed the world. Perhaps you don’t have King’s eloquence, but all it takes to change the dream is already in your hands.

Chapter 9 - Taking a Stand
One of the biggest challenges with making a commitment to change the dream is that it requires, at least to a degree, stepping away from the normal flow of Western society. Most of us spend our time worrying about accumulating wealth and buying stuff that we don’t really need and talking about things that are of no real importance. The first and most difficult step in really choosing to do something different is taking a stand against these things and choosing a different way.

This means that instead of following along with the flow of everyone else, the first step to chasing your real dreams of changing the world are to stop following their flow. Figure out what’s enough for you and just stop chasing the brass ring above all else.

Chapter 10 - The Power of Conversation
The next step to carrying forward a dream is really understanding it, and the way to do that is through the power of conversation. In an interesting way, I feel like the internet has really caused this to take off, as it has enabled people to become involved in movements and causes and conversations that were inaccessible to them even a decade ago.

If you want to change the world, find out how it works. Ask questions. Dig in and find that place in the dream where your skills can really make a big difference. Ask more questions. Do things. Be involved in the process. Let’s say you’re a web programmer and you believe in alternative energy resources. Look for a nonprofit group that espouses the same ideas that you believe in and volunteer your skills with them - help them design websites and web applications that can collect donations and reach out to more people who may be able to help.

Chapter 11 - Creating a Legacy of Enough
If one piece of the book really took ahold of me and grabbed me, it was this one. When you take a stand, change direction, and clearly commit to a cause greater than yourself, you set a great example for those around you, especially for your children. Instead of giving them an example of always battling just for more money and more stuff you don’t really need, you give them an example of battling for a cause that can affect the lives of countless people and authentically bring about change.

You can do this in a multitude of ways. Get your family and your community involved in projects. Take your child along with you as you volunteer. Involve your neighbors and friends in what you’re doing if they’re interested. Let them know by what you do that there are other options than merely following rampant consumerism, that they can, through their financial and personal choices, bring about real change.

Chapter 12 - The Turning Tide
The final chapter is merely a brief coda that reinforces the general points of the book, that once you figure out what is enough for you, you can take the abundance and really work to bring about the things that are important to you.

Buy or Don’t Buy?

The very first paragraph of the book pretty much sums up the content:

This book is entitled The Soul of Money, but it is really about our own soul and how and why we often eclipse it, dismiss it, or compromise it in our relationship with money: the way we get money, use money, give money, and/or sometimes just try to avoid thinking about money. This book is about finding a new freedom, truth, and joy in our relationship with money, this strange, troubled, and wonderful part of our lives. And it is about awakening and using the unexamined portal of our relationship with money to deliver a widespread transformation in all aspects of our life. Unltimately, this book is a pathway to personal and financial freedom.

If that sounds like left-wing rubbish to you (and it might), you’ll probably not get much out of this book or even enjoy it at all, but if that paragraph sounds exciting and empowering, then I think this book will be a home run. For me, I found parts of it to feel much like a liberal preaching to me about how to live my life, but other parts of it were quite interesting and thought provoking. Overall, it was quite worth reading; in many places, it made me seriously reflect on the relationship between my money and my values.

The Soul of Money is the thirtieth of fifty-two books in The Simple Dollar’s series 52 Personal Finance Books in 52 Weeks.

I’ve wanted to write this for a long time, but once again a reader of mine comes through. I received this question in an email recently:

I have a question about giving to charities. I was always taught by my parents I should be giving 10% of what I earn to the church, charities, the poor, etc. I have no problem doing this, and most financial books recommend giving a portion of what you earn away.

I’m getting married soon and my husband-to-be wants to know why we should do this, and to be honest, I don’t know why. Never really thought about it. Even in financial books, I haven’t found a good explanation, other than something vague like “giving your money away creates more wealth for you.”

Charity - in fact, altruism in general - is a very difficult concept to explain in a general sense. What I’ve found often is that you either have an innate understanding of why you give or you don’t, and introducing the idea to someone who doesn’t see the benefit is likely to get a shrug of indifference. The best I can do is explain in detail why I give to various causes.

First of all, charitable donations are a direct reflection of my values and perspectives. Whenever I donate money, I’m contributing it towards something that I feel has importance. If I want to see food available to homeless people in my community, I can donate to the local food pantry or soup kitchen. If I want to fight global warming, there are plenty of organizations that are fighting for such change. The real question is whether you have found something with enough importance to you to speak out with your pocketbook.

Second, helping others improves your self worth in many ways. Once you’ve given something to a charity that you truly believe in, you feel good about it. The money in your pocket went towards a cause beyond what you can manage in your daily life, a cause that combined with the similar actions of others can actually bring about change in the world. That’s not something you can get from buying yourself a flat panel television.

Third, charitable donations have indirect benefits. Here’s an example: in the community where I grew up, there was a food pantry where people would donate food and others who were in need would eat it. My parents would often take fresh produce from the garden there in the summer. The family of one of my closest friends was extremely poor and without some food support from the pantry, my friend’s parents likely would not have been able to keep their house and would have had to move away. At a crucial point in my life, this friend pushed me to do something that I would have never done on my own. The result? I received a full scholarship to college that I wouldn’t have received otherwise.

Because my parents quietly donated to that pantry, a series of events occurred that ended up with their son having an opportunity to get a college education. When people talk about charity coming back around, this is exactly what they’re talking about.

One final comment: I don’t think, like many do, that whether or not you tithe or give to charity is a sign of whether you’re a good person or not. I know some very wonderful people who don’t give to charities and I also know some people who give to charities that I wouldn’t trust my child around. A person should only give to a charity if they truly feel it is the right thing to do with their money - if it doesn’t feel right, don’t donate.

In short, even if you don’t donate any of your income to charity right now or you don’t see the purpose, don’t close your mind or your heart to the idea. When the right reason comes to you, open up your wallet and see what happens.

My wife and I used to give about 6% of our annual income to our church. They don’t require it or even ask for it outside of a collection plate; we do it because we see how much good the church is doing in the community. For example, this month they are having a non-ecumenical Christmas party with wonderful gifts for every impoverished child in the town, and we participated by buying a gorgeous coat for an eleven year old girl who we don’t know (gifts were requested and purchased anonymously). They have a free dinner for the public once a week, so anyone who needs a warm meal and some companionship always have a place to dine, and the pastor’s door is always open for anyone who would like to talk about anything that is troubling their spirit. Regardless of your feelings on religion, these services are valuable to any community’s health, and it warms me to be a part of it.

But our church is fairly large and it does have a significant endowment from some members who left part of their large estates to the church. Even though the church spends a lot of money on community services and church maintenance, the rate of growth of the investments plus the donations is currently exceeding the expenditures by quite a bit; in fact, some members sarcastically refer to the finances as the “war chest.”

On the other hand, my wife’s hometown church is in deep financial straits. Even though we are not members, we still receive their newsletter, and inside a recent one was a frank discussion by the president of the church council on the bankruptcy of the church unless they stop providing any community services at all or else let their pastor go and have only a part-time pastor for a while. At their current rate of spending, their investments and money will be depleted in eight years.

So we made a decision. We split the amount of money we give to the church into three pieces, each effectively equal to 2% of our annual income, and we are sending two of the pieces to her hometown church. Even if they change nothing at all about their budget, if they take our money and add it to their investment portfolio, our contributions alone will add almost a year of solvency to the church, which will make a tremendous difference in the lives of some people. Our current church won’t be hurt in the least; in fact, our pastor was quite happy we were doing it.

The lesson of the story is that you should put your donations where they will count. If you just quietly give each month to a church, consider which church could use it the most for survival and for the benefit of the community as a whole. If you give to a charity, consider other charities, such as The Simple Dollar’s favorite charity, the Child Abuse Prevention Center.

A dollar is a dollar, but what you do with that dollar can make all the difference in the world.