Three Ways to Reach Your Giving Goals

Three Ways to Reach Your Giving Goals
Photo by Brad Hurley

 “I'm not great with budgeting in my personal life,” Daniel Dewey recently wrote in the Effective Altruism Forum. “This is my single biggest problem with meeting my [giving] pledge. This year it bit me especially hard, and I expect to fail to meet my pledge for the year.”

Does that sound familiar? As the end of the year approaches, many of us look back to the goals and plans we established in January and shake our heads ruefully. But it doesn’t have to be that way.

It’s easy to set goals, but if you want to reach them you’ll need to ensure they’re achievable within the larger context of your life, which probably includes many competing commitments. And if you don’t have a way to monitor progress and ensure you stay on track, your goals may fall by the wayside as other priorities vie for your attention (and money) over the course of the year. If you’ve had trouble meeting a giving goal, the suggestions below might help. 

Automate Your Giving

Assuming you have a steady and predictable income, a simple way to ensure you meet an annual giving goal is to set up automatic monthly donations by direct debit or credit card amounting to 1/12 of the goal.

If your goal is ambitious, however, automatic donations can leave you vulnerable to cash-flow crises when you’re faced with unplanned expenses. What if your best friend invites you to her wedding halfway across the world? What if your car breaks down and requires hundreds of dollars in repairs? Sure, if you don’t have enough cash you can put those expenses on a credit card and pay them off over time, but the money you spend on interest could have been spent on better things, including giving more.

You can reduce cash-flow risk by setting aside 1/12 of your goal each month in a savings account instead, leaving it available to draw on for unexpected expenses while you save to do your giving at the end of the year. As those savings grow, however, they can become an increasingly tempting resource: it’s easy to tell yourself, “I’ll just borrow some money from my giving account to cover these costs and pay it back over the next few months.” But the next few months could bring other unexpected expenses, and you may find it impossible to pay back all your borrowing. 

Use a Hybrid Approach

An alternative strategy, which I use myself, is to set up automatic withdrawals for a portion of your goal while saving for an end-of-the-year lump sum to make up the difference. In my case, I set up automatic monthly withdrawals that will amount to a bit more than half my goal, which experience has shown I can afford each month with little hardship. I save the remaining funds over the course of the year and give them in December. I’ve used this approach successfully to meet or exceed my personal giving goal for the past several years. The amount in my savings allocated for end-of-year giving is much smaller than it would be if I were saving to do all my giving in December, making it a less tempting source of funds for other expenses.

Create a Spending Plan

While automatic giving works for many people, it doesn’t address the issue of how to balance and manage the competing financial priorities in your life—of which giving is but one. A budget can help in this regard, but it’s not a popular solution: in the stereotypical view, budgeting involves setting strict limits on how much you can spend on categories such as food, clothing, and entertainment, leaving no room for spontaneity. Plus there’s the tedium of tracking your expenses and comparing them to what you budgeted.

But what if you turned the concept of budgeting on its head? Instead of viewing a budget as a set of strict limits, what if you treated it as a proactive, flexible plan for how you will spend and save your income? This is the concept behind “zero-sum budgeting,” in which you decide, each time you receive income, how every single one of those dollars, pounds, Euros, or whatever currency you use will be spent or saved. You allocate your income across categories in your budget, according to your priorities and commitments, until there’s nothing left to allocate. You base spending decisions on what’s in your budget categories rather than what’s in your bank accounts. Then, over the course of the month, you shuffle money among categories as needed to cover unanticipated expenses. For every upward adjustment you make in the amount allocated to one category, you must make a corresponding downward adjustment in the amount allocated elsewhere.

While it’s called a budget, I prefer to think of a zero-sum budget as a spending plan: it puts you in the driver’s seat and forces you to make spending and saving decisions that balance your existing commitments, your goals, and your personal priorities. I’ve found it far more empowering than limiting, and actually look forward to setting up my budget each month.

Setting up and tracking a budget involves a learning curve, but after that it’s easy to maintain. I spend about 10 minutes per month setting up my budget for the following month, and another 30-45 minutes per month entering transactions (I prefer to enter them manually each day rather than connecting directly to my banks). You can set up and manage a budget with pencil and paper, a spreadsheet, or with any of the commercial zero-sum budget apps, such as You Need a Budget, GoodBudget, Mvelopes, or Financier. Some of these apps include goal-tracking features.

My budget has two categories for giving: one for regular monthly giving, which includes all my automatic donations, and another that I call “end of year top-up,” which I fund over the course of the year whenever I have extra money in my budget. I also use this category as a repository for cash-back rebates on my credit card, which I give to the effective charities I support, as well as savings I’ve achieved by changing my habits (e.g., switching from almond butter to peanut butter).

The combination of automatic monthly giving and zero-sum budgeting has been very successful for me, helping me to meet not only my giving goals but also to meet goals to save for retirement, pay off our mortgage, save up for large purchases, and adjust my lifestyle to reflect my values. I can’t imagine managing my life without a budget now.

The Bottom Line

Missing your giving goal isn’t the end of the world, and it shouldn’t be a source of shame. But it should cause you to consider whether your goal is too ambitious for your financial situation, or whether you need to work harder at reducing expenses or avoiding temptations in other areas. Daniel Dewey did this when it became clear to him that he was going to miss his giving goal in 2016. He came up with a proactive strategy for making sure he could meet his target (by contributing to his pledge on the first day of every month) while creating a new savings category to fund the kinds of unplanned-for expenses that threw him off track.

If you’ve decided to make giving to effective charities a priority in your life, any of the approaches described above should help you achieve your goal. Good luck!

Brad Hurley
Brad Hurley
Brad Hurley is a writer, editor, and project manager working in the areas of climate change communication and children’s environmental health. A former science journalist, he now works as a contractor and consultant to government and international agencies.
The views expressed in blog posts are those of the author, and not necessarily those of Peter Singer or The Life You Can Save.


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