Altruistic Actions: Your Guide to All Things Philanthropy
When you think of a traditional philanthropist, whom do you picture?
With the philanthropic space so often dominated by very wealthy individuals, it can at times feel intimidating to enter into this endeavour if you feel you don’t quite fit that description—but the truth is, philanthropy is not limited to the ultra-elite and the charitable giving space is constantly being rewritten to invite everyone in on their own terms. The community is always open to deriving new ways to contribute, support redesign, and redefine what it means to give—and doing it together.
Philanthropy is a highly personal experience—which charities you connect with, which causes are closest to your heart, and what ultimately motivates you to give are all factors that vary deeply from person to person. While it’s personal, it’s also a concept that can quickly snowball when we all combine our efforts. Five dollars may not sound like a lot, but five dollars from one million people snowballs to $5 million—an amount that could significantly aid a deserving organization. Whether you’re an ultra-high net worth individual, or whether you’re still working to build your wealth, there is a place for you in the philanthropic space—because large or small, every bit makes an impact.
In this guide, Bloom Investment Counsel takes you through all things philanthropy. We’ll be discussing everything from what motivates one to give and the main difference between charity and philanthropy, to how to select an organization to give to, some specific examples, and more.
Ready to discover how your direct efforts can change the world? Grab you favourite beverage and settle in with Bloom Investment Counsel’s Altruistic Actions: Your Guide to All Things Philanthropy!
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What Motivates Giving and Why Is It Important?
As humans, we are natural givers. You are most likely already engaging in small acts of kindness every day—whether it’s helping an elderly neighbor carry their groceries, or watching a friend’s child occasionally. The philanthropic inclination is rooted in human experience—a primary motivation for giving is feeling a personal connection to a specific cause. This connection may be initiated from past or present experience, and many individuals cultivate empathies with the missions of nonprofit organizations, becoming encouraged to offer their support.
Never underestimate the impact of any support you can lend—whether it’s large or small, time or money. Philanthropic efforts provide the chance for participants to learn and grow while having a significant impact on the community, and the world. It’s all the more rewarding when you can engage your children, siblings, parents, or friends in the initiative as well.
What Is the Difference Between Philanthropy, Charity, and Volunteerism?
- Philanthropy is a long-term strategy and usually includes making multiple gifts of time or capital to aid foundations or charities over many years. This type of endeavour is rooted in helping people and solving issues at hand over a period of time, and is generally ongoing.
- Charity, on the other hand, is often thought of as more of a short-term effort. Charitable activities are usually concentrated on delivering imminent relief to individuals or causes in need to help.
- While charity and philanthropy can be achieved by either offering one’s time or capital, volunteerism occurs when one dedicates their time to helping others without pay or other means of compensation. Volunteerism can thus be considered either philanthropy if it occurs regularly or over a long period of time, or charity if it is a short-term or immediate effort.
What Are Some Philanthropic and Charitable Giving Statistics in 2021?
- As of 2021, there are over 170,000 charitable and nonprofit organizations in Canada—so there are countless options to choose a cause that aligns closely with your values.
- 85,000 of the 170,000 organizations are registered charities, recognized by the Canada Revenue Agency.
- Canadians donated $480,295,283 to charities in 2020, which is an upsurge of 116% from the previous year.
- While the overall contribution is growing, 68% of charities have seen a decline in donations since the onset of the COVID-19 pandemic.
- With so many individuals and communities hit hard from the inception of the pandemic, it’s unsurprising that there is a surge in demand for charitable services—46% of charities are reporting an increase in demand compared to a 35% increase in the earlier stages of the pandemic.
- Due to physical distancing requirements and continuous outbreaks, 70% percent of charities have also reported a decrease in the number of volunteers since the commencement of COVID-19, and 74% have seen a drop in the number of volunteer hours they receive.
What Are Some Examples of Ways To Give?
- Give Your Time, Business Resources, or Expertise: As we alluded to above, volunteerism is a great way to stay active in the community by donating your time. Not only can this greatly aid the organization at hand, but giving your time allows you to be at the forefront of the action, allowing you direct and active involvement in a cause–which can be extremely impactful not only the organization and those whom it serves, but also for volunteers. Some examples include an accountant donating services to a local charity or a business owner giving excess supplies to their local shelter.
- Give Via a Donor-Advised Fund: Donor-advised funds are charitable giving accounts, accessible via a sponsoring organization. This method is a simple and less expensive option compared to spearheading a private foundation. With this route, you’re still able to ensure your capital is making an impact, but it does not require you to directly manage it, thereby saving you time.
- Start a Private or Family Foundation: It is relatively common for high net worth individuals and families to open private or family foundations as a vehicle for philanthropic giving. This method is a great way to ensure your contributions align with your passions and values. When set up correctly, it operates similarly to a business plan for how you give in the present and future.
How Do You Choose a Foundation or Charity to Give To?
- Identify Your Passion: Have you experienced or been affected by a particular hardship in your lifetime? Perhaps you experienced or witnessed a tragedy in your youth that you want to work to prevent today. Instead of simply giving to the first organization that approaches you, take inventory of what is important to you and take the time to find a foundation that aligns with your values and passions. Not only does this make the experience more personal, but you may find a cause that you really connect with, which can make the practice of giving your time or money all the more rewarding.
- Research to Ensure Legitimacy: Once you’ve pinpointed a cause that is close to your heart, in order to protect yourself from a potential scam, you’ll want to ensure the organization is legitimate and the one you believe it to be. Doing a deep dive into the organization’s website, and educating yourself on the various aspects of the foundation is a great starting point to keep you safe from being taken advantage of.
- Inquire About How the Charity Will Use Your Donation: If you will be giving a monetary gift, you may consider looking into how your money will be utilized. Try speaking with an organization representative or look on the foundation’s website. While all organizations have overhead costs—non-profit or otherwise, the amount of donated capital put toward a charitable cause can fluctuate considerably, depending on the foundation.
Charity Resources: How You Can Get Started
With so many different causes and organizations to give to, it can at times feel overwhelming. If you’re just starting out on your philanthropic journey, a great place to start is at Charity Data. Spearheaded by Toronto’s own Mark Blumberg, Charity Data is the largest free charity data research database in Canada, and allows you to filter by cause, keyword, name, program, category, city, and province—allowing you to efficiently narrow down your search.
Another great resource to check out is Smart Giving. Also founded by Mark Blumberg, Smart Giving provides users with a blog-style format that discusses everything from the best ways to donate to charity, to how to avoid charity scams.
Charitable Giving Tax Calculator
CanadaHelps, which is an organization dedicated to informing, inspiring and connecting charities and donors, provides an online calculator tool to compute the tax credit you will receive, based on the amount you give, and the province or territory in which you reside.
Thank you for reading Bloom’s Altruistic Actions: Your Guide to All Things Philanthropy. We hope you found it to be a valuable resource that informs your philanthropic journey. Be sure to follow Bloom Investment Counsel on LinkedIn, Twitter, Medium, and Reddit to be the first to know when our next philanthropic guide is released—up next, we’ll be broaching the topic of tax and charity!
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