Giving with Purpose: How to Maximize Generosity
The holidays often bring a strong desire to give—to show love to those closest to us and support causes that matter deeply. But alongside that generosity can come a quiet question: How do I give in a way that feels meaningful without disrupting the financial security I’ve worked so hard to build? Balancing the joy of giving with the responsibility of planning for the future isn’t always simple, but it’s a challenge worth exploring.
In this blog, we’ll explore how to give with purpose—strategies that align your generosity with your financial goals, maximize the impact of your gifts, and ensure you’re setting yourself up for the future. From understanding tax benefits to creative ways to give, you’ll walk away with actionable insights that allow you to give generously without sacrificing your financial health.
To help you put these strategies into action, download our Smart Giving Checklist, a practical guide to planning your holiday giving thoughtfully and effectively.
Let’s dive in and explore how you can make the most of your giving this season—and beyond.
1: Building Generosity Into Your Financial Plan
Integrating Giving Into Your Budget
Generosity begins with planning. Before you start giving, decide how much you can afford without disrupting your financial stability. Build charitable contributions into your monthly or yearly budget to stay on track with your goals, like saving for retirement or paying down debt.
Tax-Efficient Giving Strategies
Giving can also be smart from a tax perspective. Here are some ways to make your contributions more impactful:
Qualified Charitable Distributions (QCDs): If you're over 70½, use funds from your IRA to donate directly to a charity, reducing taxable income.
Cash Donations to Charities: For those who itemize, cash donations to qualified charities can reduce taxable income.
Gifting Appreciated Assets: Donating stocks or real estate avoids capital gains taxes while supporting the causes you care about.
Bundling Donations: Combine several years' worth of donations into one tax year to exceed the standard deduction and maximize itemized benefits.
Legacy-Focused Giving Options
If you want to make a long-lasting impact, consider tools like:
Donor-Advised Funds: Set aside funds for charitable giving over time, with immediate tax benefits.
Charitable Trusts: Provide a steady stream of support for a cause while potentially reducing estate taxes.
2: Creative and Impactful Gifting
Gifting to Support Loved Ones’ Financial Futures
Generosity can also help your loved ones build a strong financial foundation. Consider:
529 College Savings Plans: Fund a child’s education and enjoy tax-free growth on qualified withdrawals.
Roth IRAs for Children: Start their retirement savings early if they have earned income.
UTMA Accounts: Save for a child’s future needs, offering flexibility for expenses like education or a first home.
Note the IRS Gift Tax Limits of $18,000 per person in 2024, increasing to $19,000 per person in 2025. Gifts exceeding these limits may require filing a Form 709, the United States Gift (and Generation-Skipping Transfer) Tax Return.
Socially Responsible Gifting
Support causes you care about through socially conscious investment options, such as:
ESG Funds: Invest in companies that align with environmental, social, or governance values.
Custom Impact Portfolios: Use separately managed accounts (SMAs) to create a portfolio tailored to your values.
Additional Strategies
Employer Matching Programs: Maximize donations by taking advantage of matching contributions from your employer.
Using Gifting to Reduce Estate Taxes: Strategic gifting during your lifetime can lower potential estate taxes while helping others.
3: Teaching Financial Responsibility Through Giving
The holidays provide a unique opportunity to instill valuable financial and philanthropic lessons in the next generation. By engaging children in thoughtful giving, you can nurture empathy and long-term planning skills.
Family Traditions Around Philanthropy
Involve children in the giving process to make it meaningful and memorable:
Choose a Cause Together: Let children research and select a charity or cause they care about. This can help them connect with the value of giving.
Family Volunteering: Spend time volunteering at a food bank, animal shelter, or other local organization. Sharing these experiences fosters a sense of purpose and gratitude.
Matching Gifts: Encourage children to save for charitable giving and offer to match their contribution to amplify the impact.
Encouraging Long-Term Thinking
Use holiday gifts to teach children the importance of saving, investing, and planning for the future:
Investment Accounts: Set up a custodial brokerage account or a UTMA account to show how investing works. You can even let them help choose a stock or ETF to make the process interactive.
Roth IRAs: If a child has earned income, starting a Roth IRA allows their contributions to grow tax-free for retirement.
529 Plans: Encourage education savings by contributing to a 529 plan, explaining how the funds can grow to support future college expenses.
4: Non-Monetary Ways to Give
The holiday season doesn’t have to revolve around financial gifts. Often, the most meaningful forms of giving come from sharing your time, skills, or thoughtful gestures that create lasting memories.
Volunteering Together
Spending time helping others can be just as impactful as monetary donations. Consider these ideas:
Volunteer Days: Organize an outing to a local charity, such as delivering meals to those in need or participating in a community cleanup.
Sharing Expertise: Offer your professional skills to help others in need.
Creating Meaningful Experiences
Instead of buying material gifts, focus on creating shared experiences that bring joy and connection:
Plan a Group Outing: Go hiking, visit a local attraction, or host a game night to spend quality time together.
Craft Personalized Gifts: Create homemade items like photo books, holiday decorations, or handwritten letters expressing gratitude.
The Takeaway
Generosity is one of the most rewarding things we can do, but it doesn’t have to come at the expense of our financial security. By making thoughtful decisions about how, when, and what to give, you can create a lasting impact—both for the people and causes you care about and for your own financial future.
Whether you're supporting a charity, setting up financial tools for loved ones, or simply sharing your time, there are countless ways to give with intention. This holiday season, take the opportunity to reflect on how your giving can reflect your values, enhance your financial goals, and create meaningful experiences.
Ready to give smartly and sustainably?
Download our Smart Giving Checklist to plan and maximize your generosity today!
If you’re interested in personalized guidance on integrating generosity into your financial plan, schedule a free consultation today to explore how we can support your goals for this holiday season and beyond.
Disclaimer: The blog post is for general informational purposes only. This article is not intended to be a substitute for specific financial, tax, or legal advice. Reproduction of this material is not permitted without written permission.