The Problem with Giving Away Money

It is said that it is better to give than to receive. This quote is usually mentioned most during the Christmas holiday season as a means of stimulating sales for stores that make most of their money during the last six weeks of the year. When we view this quote from a charitable perspective, the sentiments may not be quite the same.

Let us be clear: charitable giving usually involves money, not time, and most people have a hard time giving up their money – especially if it was hard-earned. This is not the major problem most aspiring philanthropists face when parting with their money – it is the fact that many charitable organizations are poorly run and are interested in spending the money on pet projects, rather than partnering with philanthropists to advance their organization’s goals and objectives.

People who have created significant wealth are frequently driven, goal-oriented individuals. They have a high level of expectations for how a charitable organization should operate. We have a number of clients like this who are more than willing to make significant gifts; they just find it difficult to locate organizations that inspire them to give, are willing to partner with them and are, of course, well-run.

The mistake many charities make is that they want the donor’s money – not so much the donor. They are willing to establish a superficial relationship with prospective donors in order to eventually receive their funds. The point these charities miss is that financially successful people may be an untapped well of wisdom that can help a charity to materially advance their agenda, if they only asked.

Charities need to understand that today’s philanthropists are different than their parents. They are not so much interested in the purchase of an edifice, as in getting actively involved with the work of their chosen charities. They prefer to make fewer, more significant gifts, rather than donating smaller dollars to a large number of organizations. In order to tap the true potential of philanthropy in today’s world, donors and charities need to better understand the needs of each other.

Ogorek Wealth Management, LLC

Ogorek Wealth Management, LLC