The Real Value of Charitable Giving
Over the last few years, charitable giving has quietly shifted. A 2024 study by the Lilly Family School of Philanthropy found that after the 2017 tax law change, U.S. charitable giving dropped by nearly $20 billion. The reason? Fewer people itemize deductions — meaning many no longer receive a direct tax benefit from giving.
But even without the deduction, generosity hasn’t disappeared. For many of my clients, giving remains one of the most meaningful parts of their financial plan. It’s a reflection of purpose, gratitude, and faith — not just numbers on a return.
An important part of financial planning for my clients is making room in their budgets for giving. I’ve lost count of the times I’ve heard, “I’d love to get to the point where I could give without limits — without worrying how it might affect my cash flow.” Whether it’s supporting a local organization, a cause that’s dear to their hearts, like stay-at-home moms, women overcoming domestic violence, or veterans — that desire to give freely runs deep.
Giving Without the Tax Break
Most households today take the standard deduction, which means smaller donations may not qualify for a tax write-off. Yet that doesn’t make giving any less powerful — it just changes how we approach it.
Instead of focusing on whether a gift is deductible, think about why you give and how to do it in a way that feels both intentional and sustainable.
Even when there’s no direct tax advantage, generosity continues to offer something far more valuable — a sense of fulfillment, connection, and purpose.
How to Give with Intention
Even without the same deductions, there are still smart, strategic ways to give that align with your financial goals:
Donor-Advised Funds (DAFs)
Think of a DAF as your personal giving account. You can contribute a lump sum (and potentially itemize that year), then distribute donations to charities over time. It’s an easy way to “bunch” multiple years of giving into one, creating flexibility and consistency in how you support causes that matter to you.
Qualified Charitable Distributions (QCDs)
If you’re over age 70½ and have a traditional IRA, you can donate up to $108,000 per year directly to a qualified charity. The amount counts toward your required minimum distribution (RMD) but doesn’t increase your taxable income — a great strategy for retirees who want to give purposefully and efficiently.
Appreciated Assets
Donating investments that have grown in value (like stocks or ETFs) allows you to avoid capital gains tax and may qualify for a deduction if you itemize. It’s a win-win for both you and the charity.
Smaller Gifts Still Matter
If you don’t itemize, that’s okay. Many of my clients build giving right into their monthly budgets — whether it’s $50 a month to a local shelter, tithing 10% to their church, or sponsoring a community project. Giving regularly, even on a smaller scale, keeps generosity part of your everyday financial rhythm.
The Heart of Giving
Generosity doesn’t just benefit others — it transforms how we live. Research shows that people who give experience higher levels of happiness, gratitude, and peace of mind. Giving strengthens our sense of community and reminds us that wealth isn’t only about accumulation — it’s about purpose.
Even in a world where fewer people receive a tax benefit for giving, generosity still provides one of the greatest returns — one measured not in dollars, but in joy and impact.
If you’d like to revisit or refine your charitable giving strategy, I’m here to help you explore options that align with your life, values, and financial goals.
DISCLAIMER:
The information presented on this post is believed to be factual and up-to-date, but RWP does not guarantee its accuracy and it should not be regarded as a complete analysis of the subjects discussed. Comments should not be construed as an offer to buy or sell, or a solicitation of an offer to buy or sell the investments mentioned. This is not legal advice and is for educational purposes only. A professional CPA, Financial Advisor or Attorney should be consulted before implementing any of the strategies discussed. Investments involve varying degrees of risk.