Giving away (often vast) sums of money can be a more involved process than many philanthropists first assume. When working with an organization such as ours, of course, the mechanics are quite simple. We handle the administration and you focus on steering your giving in a preferred direction. Even though the process is streamlined, that latter part can still sometimes confound philanthropists.
Why? Being the generous group they are, donors will often look to patronize a wide variety of charities and create change across the broadest spectrum possible. There’s no doubt that can be a perfectly acceptable strategy. Many, smaller donations can still have an impact when given to a variety of organizations over time. But while a healthy selection of our donor clients have some idea of the charities they want to support at the start of their philanthropic journey, most do not.
That latter group will often develop a long list of target organizations and ask for their foundation funds to be distributed to each in specific intervals. Again, it can make sense to spread the wealth (literally and figuratively) across a wide swath of charitable organizations.
But what we always advise our donors is to first think strategically about their giving objectives and outline the values and causes they wish to uphold or advance before disbursing their funds. That could mean supporting a specific program at a children’s hospital, or perhaps an arts program, or a music therapy initiative. The specifics will vary, but what’s truly important is developing a plan that sets the stage for the creation of a lasting philanthropic legacy for you and your family over decades, rather than making less beneficial one-off donations. As we like to say, it’s the difference between writing cheques and being a true philanthropist dedicated to bringing about a positive impact with your charitable gifts, and contributing to long-term change.
As part of that strategizing, it’s important to remember that in many cases, less is more. Supporting fewer charities can often be the key to helping those organizations achieve their objectives. The math here is quite simple: Committing a $50,000 donation over five years in support of a single cause will go a lot further than making a $1,000 donation to 50 different charities. Every dollar matters, but targeted donations can generate a far greater impact.
Supporting fewer charities will also provide opportunities for you and your family to better quantify the results of your giving. It’s far easier to analyze a limited number of impact reports (which most charities are equipped to provide) and determine how your dollars made a difference, versus dozens.
Not only will your donations go further, but having fewer preferred charities on your philanthropic support list inspires many donors to also give their time or expertise to a charity’s board of directors. Being able to directly help the people your favourite charity is working to support takes giving to another level. This is especially important if your aim is to make philanthropy a family-wide affair, particularly when your children are young. Creating an appreciation for volunteerism, the life challenges that others face and the value of wealth, are all compelling benefits of a more hands-on approach to philanthropy. Some of our donor clients—particularly those who are retired—become so involved that their board participation or other volunteer support becomes the equivalent of a fulfilling part-time job. The joy of giving takes on entirely new meaning when they have a direct hand in changing people’s lives for the better.
Lastly, targeting your philanthropy by engaging with a more select group of charities also minimizes the chances for unwanted solicitation. Canada Gives clients enjoy the benefits of having our team field all grant requests, but philanthropists who manage their donations independently often find themselves inundated by donation requests from a plethora of charities. This is perfectly understandable on the charities’ part—they need to fund their great work, after all—but the ensuing demands on a donor’s time, not to mention a lack of privacy, can quickly become burdensome.
It’s tempting to be as generous as possible, sharing the wealth with many charities instead of only a select few. But the real impact comes with a targeted, strategic approach to giving. Sometimes creating that lasting legacy means being prepared to decline opportunities to donate to many charities and focusing on those few that best align with your values and forward your philanthropic goals.
Denise Castonguay, Executive Director and CEO