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A Different Approach to Giving – Personal Charity

My Personal Charity

Money Gift


As Christmas grows near, many times (including this year) I don’t have an extra $1000 or even $100 to give to charity.  At this point in my life I don’t have enough  or make enough to give that hard-earned money away, especially after buying presents for others.  Still, I would like to help people in need out, especially near Christmas…  I could give to the Salvation Army (and actually I do), but I’ve been thinking that I would rather do something on a more personal level, and since I like dividends, I thought why not invest my money in some dividend stocks and use the dividend for charity!

Charity Funded By Stock Dividends

Using dividend stocks to fund charities could also serve as an unofficial emergency fund in case of a downturn in the economy or something horrible happen to me like the possibility that I would lose my job.  While it might not be a lot of money, every bit helps!

The best thing about giving money to a Charity (or Charities) with the dividend payments from dividend stocks is if the stock has a consistent history of increasing dividend payment, each year the payout from the dividend (minus the tax consequence) would increase!  So each year the payout would become more and more, not to mention that you buy more shares of the stock every year too!

Starting A Personal Charity, A Small Beginning

Okay, now let’s look at the details…  Let’s say that you were able to save $1,000 per year for the “Dividend Stocks for Charity” fund.  So is the dividend payout came to 4%, that would be $40 for the first year (I’m skipping the taxes here because the amount is so low).  There isn’t too much you can really do with $40, except:

  • Give the $40 to a few (or one) favorite servers (waitress, or similar) that you know that always makes you enjoy your time at the location they are working at!
  • Drop the money in a Salvation Army Bucket…
  • Anonymously mail some deserving child (or family) that is always nice but may be having trouble financially.  Perhaps address the mailed gift from Santa, or “A Friend That Knows the Good You Do”, or something similar…
  • The Salvation Army’s kettle is always a good option for charity, if you are too busy.
  • Perhaps there is a community project that is accepting donations, or a specialized community group that would benefit…
  • Or you could go out and buy toys for the “Toys for Tots” program.

The thing is that you can do anything your want with the money!  You wouldn’t be restricted to just organized charities!  In fact 100% of your personal Charity fund could go directly to the cause that you want to give it too.  With large business charities, a lot of the money goes to support the running of the business of the Charity.  Sometimes more than half the money you would contribute wouldn’t even make it to the cause that needs the charity.

A Personal Charity just Feels Better!

For me personally, I prefer to have feedback and accountability for the money that I give away to charity!  With my own personal charity, I’m able to see the results of the money that I gave away.  If I decided to buy a child a bike, I can roll the bike to the doorstep where the child lives, that way I know the child received the gift, and I might even be able to see such a child riding that bike someday.  I’m sure that would be an awesome feeling!

Of course we would still contribute the our regular “business organized” charities also…

Here’s wishing you the best of holidays this year!


18 Responses to A Different Approach to Giving – Personal Charity

  1. Philanthropy has been getting more and more efficient. People like Bill Gates are making sure their dollars are used in the best way possible. A personal charity allows you to know how efficiently your dollars are being used and to which particular causes they are going towards.

    • Yes, I agree and I think it would be the best use of our money… Why not give charity to people local in the community or help the community out in addition to corporate charities…

  2. I like “personal” charities and community-based charities a ton. I know that big charities help lots of people in other areas and they need help, too, but it’s deeply satisfying for me to give to causes in the community I live in.

  3. Don, I really really like this. Great ideas! I set up automated giving through charity navigator so I don’t even think much about it. Every quarter, my contributions are automatically made to my preselected charities.

  4. With all of the things you want to use dividends for, you’re going to have to put a lot of money in dividend stocks.

    It’s an interesting idea. Would add reinvesting part of the dividends. Get the compounding thing going and build up a nice sized fund and payout. Possibly to a size were it’s all automated.

    • You are right, I need to make more money so I can sock more away in dividends stocks 🙂

      Yep, it wouldn’t be a bad idea having the dividend fund grow until it reaches a critical mass then do distributions… It’s all good 🙂

  5. Like the idea of using dividends to fund your charitable donations. I made a small endowment to Kiva which in turn combines my gift with others to fund loans in the developing world. What I like about Kiva is that I get to choose who I loan to and get feedback on how the loan is being used. When the loan is paid back I then turn around and loan it out again.