Budget Basics 101: Why give as well as receive

You’ve made it through the budgeting process with flying colors. Yes, there have been some stumbling blocks along the way. Still, you were able to vault over them in order to pay off your debt, build your emergency fund, and heavily invest in a 401(k), IRAs, or mutual funds. You even found enough money to payoff your house well ahead of time. You are, as the experts say, rolling in the dough.¬†And now, as one of the final and continuing steps on your path toward financial independence, you’re ready to take the plunge and start giving away some of the money.

Right, right, you’re somewhat befuddled by this. You’ve spent months, even years, paying off debt and making yourself financially independent, and now we’re telling you to give your money away. First, we’re not asking you to open up a credit card account or get a bank loan. These things would just put you back right at the first step. What we’re talking about is giving away money to worthy causes.

It’s fun to have money to send your children to college, buy something nice for you or your spouse, and generally feel comfortable you won’t have to borrow again. However, as they say, how much money does one person need? There comes a point where there can be excess. Those of you who are still in the midst of paying off debt may not get this, but it’s true. Therefore, why not give some of it away to charities or other causes?

Here’s the thing — receiving is great, but giving is healthier. Donating a large amount of money to a cause you feel passionate about, and then seeing how the organization transforms with the funds, does something to a person. They smile more and feel like some form of weight is lifted from their shoulders. This isn’t the weight of debt they feel. Rather, it’s the weight of not being able to donate in the past which falls off.

By the way, you wouldn’t be the only financially stable person who does this. Read up on the news and there are numerous examples of multi-millionaires and billionaires who have decided to give away most of their fortune to other causes. Now, you don’t have to do this, but we bet you’d feel like one of the gang if you heavily donated like those financially independent stars you tend to read about or see on television.

You’ve come this far, so why not finish on top. Do your research, including potential tax implications, and choose which organizations you wish to donate to. Who knows, you may become so passionate you decide to devote your time as well as money to a specific group.

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