524 comments

Notes on Giving Away my First $100,000

For my 42nd birthday, Mrs. MM let me give away all this money

For my 42nd birthday, Mrs. MM let me give away all this money.

Here’s a little quiz:

Suppose you are living an extremely happy life  – all your material needs and wants are met, and there is still money to spare. Then suddenly, you get even more money. Do you:

a) Try to think of even more stuff you could buy for yourself with that extra money?

b) Try to find more efficient things to do with the surplus?

 

For many people, this might seem like a trick question. After all, needs are cheap but how could you ever have all your wants met?

I mean sure, you might already have a Honda, but you obviously still want a Tesla, right? And if you could afford it, why would you not forego ground transportation altogether and have a private helicopter on call, with a Gulfstream G6 waiting on the airstrip? Perhaps at that point you could be satisfied – you’re sensible and not one of those greedy people who needs a yacht. But that still leaves a long, long climb to full life satisfaction.

For me, the point of full satisfaction is also pretty high – not just basic food but fancy stuff from around the world. A glorious modernist house on a park in one of the country’s most expensive counties, and unlimited, bikes, music, computers, and whatever else happens to appeal. Hell, I even have a brand new electric car just to see what the buzz is about. The tab for this lifestyle – a little over $25,000 per year – is not quite at Gulfstream elevation but it still puts my family in the top 2% of the Global Rich List.

Since I hit my consumption ceiling a little earlier than a proper rich person, I have been thinking about option (b) above for a number of years now. And if you care about trying to be logical when dealing with surplus money, your research will very quickly lead you to the Effective Altruism movement, and indeed I wrote about it as far back as 2012 with a review of Peter Singer’s The Life You Can Save.  As with most useful things I’ve learned in the last five years, it was readers of this blog who clued me in to the idea.

Effective Altruism is an attempt to answer one simple question: where can our surplus money do the largest amount of good? When buying something for yourself has only a neutral or small positive effect, funding charitable causes in a relatively rich country can be a way of getting more happiness for your dollar. But meeting even bigger needs in a much poorer country can measurably outperform either of those options by a huge margin.

Taking an example from the video below, $40,000 can raise and train one beautiful golden retriever to help a blind person in the US – undeniably a good thing. Or it can pay for simple trachoma operations to permanently cure about 2000 people from preventable blindness in Africa – quite a strong argument to allocate at least some of your generosity there.

Watch: Peter Singer’s moving TED Talk explaining the ideas behind Effective Altruism in about 17 minutes. Or you can read the same ideas on his The Life You Can Save website. 

Even way back in 2012 I knew the idea was solid, and yet somehow the MMM family has managed to give away only relatively small amounts of money each year relative to our income, and thus other money has continued to accumulate.

I have been stuck in an analysis paralysis, wondering if I should give individually to conventional charities, or use wider reach of this blog to do something cooler that would make news headlines and thus create a multiplier effect. For example, what if I could:

  • Personally fund some critical bike path in my town, drawing attention to the highest-returning investment any city can make?
  • How about hiring some creative geniuses with an appropriately bizarre sense of humour to help me run a brilliant and educational YouTube channel?
  • Could we collectively buy up a few blocks of a neighborhood and permanently shut down the roads to cars, keeping a few shared vehicles in a lot at the periphery and tearing up the pavement to become a little woodland/garden for our kids, and our utopian living space? Imagine how much the US would change if this became the new model for town planning?

These are great ideas, but they all take work, and my power to get stuff done is quite finite. So by holding out for them, I am falling in to the classic trap of Perfection is the Enemy of the Good. Why not try something I know is good, right now?

So I resolved to start with a donation amount that feels big enough to be meaningful to me, but not so big I am afraid to do it, and just do it. For me, that number was $100,000.

It sounds big if you think of it as “Four years of the family’s spending!”, or “An entire University education for a kid!” but only medium if you consider it’s only a mid-range Tesla. And downright small at less than a quarter of what this blog earned last year (before tax at least), which I managed via only the occasional typing of shit into the computer.

By keeping our lifestyle* at the previous already-glorious level we set at retirement, we have found that 100% of the extra income and windfalls we’ve encountered in these subsequent 11 years has been a pure surplus.

Effective Altruism is based on the principle that All Human Lives have Equal Value. Thus, they suggest that you simply give to the charity has the largest effect on improving and saving human lives, per dollar. The intellectual headquarters for the movement is a website called Givewell.org

According to them, the most effective charity per dollar is currently the Against Malaria Foundation – a very minimalist organization that distributes protective Mosquito nets in Africa – efficiently and with a focus on measurement.

But being a flawed human, I wasn’t quite satisfied with such pure logic and decided to spread out my first donation just a bit, according to some of my values. What I came up with is this:

Health and Poverty: 

Environment:

American and Local Causes:

  • Planned Parenthood: (helps people control when they have kids, but often under political attack) $5,000
  • The American Civil Liberties Union: (uses the law as a watchdog to prevent powerful established groups (whether corporations or religions) from overriding individual rights): $5000
  • Khan Academy: (amazing, always-growing great education, free for millions of kids and adults) $9000
  • Wikipedia: (via WikiMedia foundation – an independent, hard-to-suppress open source of information for the world) $1000
  • Bicycle Colorado: $5000 (works to push bold new bike laws and infrastructure into the fertile ground of Colorado, which are then copied by other states).
  • My local Elementary School (just a bunch of good people doing good work for kids): $5000

These are pretty arbitrary numbers, adjusted just to prioritize the Effective Altruism stuff most and still have it all add up to the right amount. My list is not meant to be expertly allocated, just to start putting some money to work, highlight a few causes, and give me a wide range of different things to start feeling good about.

What Does This Feel Like, and Should You Do it Yourself?

In summary, deeply satisfying and happy. I have known for years that I wanted to start doing this, but on the day that I actually dropped all those checks into the mailbox, I felt a great lightness. That night, I fell asleep with the happy peace that comes from letting go of just a bit of selfishness and fear. After noticing not even the slightest regret, I can see that it will become even easier as time goes on.

I get quite a few emails from readers asking if I think charitable giving should be prioritized early in life, or if it’s more efficient to wait until you reach financial independence. After all, certain religions come with the concept of tithing and suggest that people do it even if they are in personal debt.

For anyone with my personality type, this would not work – obligations imposed by others are counterproductive and you must decide for yourself what feels right. Getting out from a stressful situation – whether it is debt or an unsatisfying career, is a good use of your time and may even allow you to be more generous over your remaining lifetime.

On the other hand, if you’re a beginner and are curious, there’s no harm in just trying out the idea on yourself. You might try giving just $100 or so to a few favorite causes and noting the effect on your feeling. If you are financially stable and that amount is too small to cause a thrill, try $500 or $1000. If the practice proves satisfying, you’ll automatically decide to do more.

The thing about money is that even in a country like the US where almost everybody is rich by world standards, the top 10% of us own over 75% of the wealth. As a member of that lucky little slice, I won’t waste time complaining about the system. But I will suggest this: Since we obviously have all the money, and yet building a happy lifestyle for ourselves should not be particularly expensive, we might as well put the bulk of our money to efficient use improving the world – if we happen to enjoy that sort of thing. Meanwhile, since the bottom 90% is sharing the remaining quarter of the earnings, I’d expect a lower rate of philanthropy.  How’s that for hardcore capitalist libertarian socialism?

What Other Causes are Worth Supporting?

Since this is just my one round of donations, all the doors are wide open.

If you were assigned to do the most good for the human race with each dollar you had available, what would you spend it on? Please share your ideas in the comments and we’ll keep getting better at this stuff together.

* Actually this part about completely resisting lifestyle inflation is a lie. Since becoming richer than expected I have dropped all restraint in the area of buying myself fancy burritos. Especially on trips. I even pay for my friends’ burritos frequently. Man, have we had some good ones.

—-

Other Helpful Stuff:

Unsure about the value of giving away your hard-earned money? Apathy towards giving ususally comes from believing in various Myths about charity.

Tax Strategy: A further bit of great news is that this $100k round of donations will actually save me about $30,000 in income tax. Contributions like these come off of your taxable income as “itemized deductions”. The limit is 50% of your Adjusted Gross Income, and the deductibility also starts to phase out slowly in certain cases if you make more than $311,000. A few details on my Accountant’s blog (The Wealthy Accountant), and on this Fidelity page.

During research, I wondered about  Charity Navigator, which ranks a larger number of charities based on administrative overhead and other stuff. How do they relate to GiveWell?

Freakonomics says the Givewell method is better, because there is much more to effectiveness than this ratio, and the ratio itself can be manipulated. When I saw this Angry Rebuttal by Charity Navigator founder Ken Berger, which resorted to name-calling and based his argument on, “Yeah, but who are YOU to say it’s better to donate overseas than in rich countries? If everybody did that, we’d never help anyone locally!” I felt even more confident about Givewell and Effective Altruism.

  • Helen October 26, 2016, 3:27 pm

    A note on non-profit admin expenses as I saw a couple of comments on “wasteful” NFPs. I find that often comes up when people discover that NFP heads are making 6-figure salaries. Running a large NFP is an immensely challenging, stressful job, you need a qualified individual in that position and so you simply have to pay a competitive salary. It’s all very well to claim that people should be doing it for the love of the cause (I do – I’m certainly not particularly well-paid even on the NFP scale), but clearly those people would be making significantly higher salaries in the corporate world – they HAVE essentially taken a pay cut for the cause. Admin costs as a percentage of expenses is certainly one aspect to consider when evaluating a charity but it is only one, and don’t immediately rule an organization out because you are miffed that the executive director makes $200k.

    Reply
    • Anonymous October 27, 2016, 2:28 am

      Agreed. If an executive director costs 100k per year but rustles up fifty times that in additional donations, they’re worth it.

      Reply
  • vandemiere October 26, 2016, 3:31 pm

    Hi,

    I think quite highly of the OUR center in Longmont for local giving. They support folks in need and seem to do great work with low overhead for the community.

    Vandemiere

    Reply
  • Sandy October 26, 2016, 3:46 pm

    Good for you :) I like your choice of charities too….
    A couple of other good ones (well, I think so anyway) are http://www.greenpeace.org/international/en/
    and https://www.hollows.org.nz/ The Fred Hollows Foundation in particular does a fab job, especially around the Pacific where blindness often due to diabetes is prevalent. A donation in USD would make an even bigger difference since your money is worth more than ours ;-)

    Reply
  • Liesbet October 26, 2016, 3:54 pm

    Awesome! Reading every new sentence of your blog made me happier and happier and increased my respect for you even more. What a perfect use for some extra money you have laying around. One of the things I also keep telling myself is “Whenever we have more money, I want to donate to good causes and buy more gifts for people I love.” (We are living on minimum income by choice to maintain our basic, adventurous lifestyle on the road). Then, about six months ago, my husband said, “Why wait? We can donate some now.” So, we started donating $10 a month to an animal shelter called Best Friends. It is not a lot, but it does feel good! One day, we will visit that no kill shelter in Utah and pick up a new family member. So, as a suggestion for causes to donate for: abused animals or eliminating the stray dog problem in less developed countries. Ideally, tackle the “breeder problem” in the US, so people adopt more dogs and cats instead of “buying” them from breeders who produce more pups, while there are already so many wonderful pets available (millions) that get killed if not rehoused…

    Reply
  • FuR October 26, 2016, 3:57 pm

    Are you able to note on your donations that you don’t wish to be placed on their mailing lists?
    Some of what holds me back from donating to places is the amount of time/paper/money that
    will put into looking for the next donation if I send them money. Email all you want, but stop
    killing trees, I’ll give again when I can.

    Reply
  • Kandice October 26, 2016, 3:58 pm

    This is one of my favorite posts, Pete. In the last few years I became aware of the Center for High Impact Philanthropy, which is part of the University of Pennsylvania. Their goal is to help organizations and individuals do exactly what you’ve described – to make the biggest social impact possible with the amount of financial resources provided, whether $10 or $100,000. They provide so many amazing (free) resources analyzing ways to achieve good in different areas of interest, such as income inequality, global health initiatives, addressing extreme poverty, mental health issues, etc. Their website is http://www.impact.upenn.edu if anyone is interested in learning more. The founder of the Center gave a great Ted talk called “Amplify the Money You Give” here: https://www.youtube.com/watch?v=RgS6gEBhKfw

    Reply
  • Mark October 26, 2016, 4:01 pm

    Very timely, because my wife and I started researching this TODAY! We have been beneficiaries of the ACA (Obamacare). After being relatively comfortable paying up to $1000/month for healthcare we suddenly were subsidized down to $350/month, and this year we chose a lower level plan that had a monthly premium entirely covered by our ACA subsidy. So far, we have been lucky, healthy, and are beneficiaries of a $1500/month federal subsidy. Next year that subsidy will be $2300/month! The main thing that bothers me about Obamacare is that in states like mine that did not expand Medicaid, I get a huge subsidy with my $45,000 of passive income, and substantial assets, while the poor guy and his wife making far less don’t qualify for subsidies, so they have no health insurance. So, after that long intro, I started researching free medical clinics in the area, and found a very good one right here in our town. We stopped by today and spoke to the director. They do NOT take anyone who is already on Medicaid or has any health insurance. They see very few children (most are Medicaid elgible) and no elderly (also mostly Medicaid or Medicare eligible) but they see plenty of people. We are considering a monthly donation of maybe $500 to this organization. We decided a long time ago to make our financial contributions more concentrated and to give locally. So, no more writing 100 checks to 100 national charities that fill your mailbox with junk. We also have donated very little dollars (but lots of time) to charity over the past 8 years, but recently have felt more financially secure.

    Reply
  • DebtFree2003 October 26, 2016, 4:14 pm

    Thank you so much, MM, for this post and for the list of other organizations to which I can contribute. For over ten years I have been donating between $50 and $100 a month to a certain cause, Planned Parenthood or Humane Society as an example. I can keep track of each donation so I don’t duplicate my efforts more than once per year. I am a believer in spreading the wealth around to those who need it more than I do. After all, how much more crap do I really need?

    By the way, thank you for supporting the schistosomiasis control initiative. I am a bladder cancer survivor (for now) and only through my diagnosis did I learn that this parasite may cause bladder cancer. Clean water, clean food, and clean housing are basic necessities of life. After those items have been met, a good education (money!) is icing on the top.

    Reply
  • Adventures with Poopsie October 26, 2016, 4:15 pm

    Well done MMM, that is an extremely impressive amount to donate! It’s truly inspirational.

    We were only discussing our charitable giving last night. On the odd occasion we donate small amounts throughout the year, but generally do most of our donating in December, around Christmas. This isn’t for any particular reason, I just find it easier to donate in larger chunks rather than smaller monthly donations.

    This year we have settled on the amount of $1500. We will each pick where $500 goes and then the final $500 will be a joint decision. This allows us to target charities that might be important to us individually, but may not be on the other person’s radar. For example, I donate to Ovarian Cancer research because I lost someone to the disease. Poopsie has other charities he likes to focus on, so this method allows us the best of both worlds.

    I was not aware of givewell.org so I’ll be checking that out tonight and possibly refocusing our giving. As we are in the accumulation phase with about six years to go, $1500 is what we are able to comfortably give right now. Of course, I hope that continues to increase and I look forward to retirement where not only can we give money, but we’ll have an abundance of time to give as well.

    Reply
  • John October 26, 2016, 4:22 pm

    Awesome giving! As for your last question: If one is serious about doing the most good for the human race, I’ve found the case for NGOs working on the far future convincing. Since the future is vastly greater than the now, even a small chance of affecting humanity in the long run could be worth it. For example, MIRI (https://intelligence.org/) is working on preventing potential risks from strong artificial intelligence.

    Alternatively, I might not aim for the human race at all. http://www.animalcharityevaluators.org is doing some good work in estimating the impact of NGOs focused on helping animals, with results that would be promising even if they turned out to be wrong by orders of magnitude. Something like 10 animals saved from factory farms per $ given, I think.

    Reply
  • Taylor October 26, 2016, 4:43 pm

    Buying up a few houses and getting rid of the roads while sharing a few cars is my actual goal. I would LOVE to get my entire family in the same neighborhood with lots of communal outdoor space, etc. I honestly would just love to live like that in general, but I think it would be even more amazing with the people I love :)

    What I’m trying to say is, PLEASE DO THIS. Maybe it could become a standard thing (or at least gain headlines and get people thinking) *starts chanting* DO IT DO IT DO IT

    Reply
  • Walker October 26, 2016, 4:44 pm

    MMM, thanks for your article! I really appreciated the thoughtfulness of your charitable donations, and the links to the various organizations are very helpful.

    I’ve already been inspired by your blog to come up with a alternatives to the typical Christmas presents (e.g. wasting money to buy crap people don’t actually need). My first idea was to make a cookbook full of family recipes that remind us of loved ones.

    This post has also inspired me to make donations to various charities on behalf of/in honor of recipients. My mother is a nurse and I think she would be happy to know that a donation to MSF has been made in her name! I hope that you might consider the same, and share the idea (and others ideas!) with your devoted readers, as buying lots of crap/wasting money in the name of “gifts” during the holiday season is likely difficult to navigate for many of us who share your ideas about consumption.

    All the best for your hard work and charitable spirit, you are truly an inspiration. :)

    Reply
  • Mr. RIP October 26, 2016, 4:47 pm

    I’ve been waiting for years for this to happen! Now you’re a living proof that money works better in the hands of wise people. All those bullshits about “if you don’t spend your money you’re not contributing to growth, bla bla bla…” are definitely and forever gone. Thank you MMM!

    Moving on. Other causes worth supporting… it’s a very tough question. I’ve always thought that I’d love to contribute my time more than my money to causes I believe in, which usually revolves around children: their health, their rights, their education. I’ve supported roomtoread and contributed building a lot of libraries in Asian south-east. I’d love to go there and help, directly, with my time and eventually with my money.

    Reply
  • Helen October 26, 2016, 4:50 pm

    I support Charity Water. Based in New York, I am in Australia, but 100% goes to providing people access to clean water. Its a basic human right. Before the education transport or infrastructure, lets give them safe drinking water.

    Reply
  • Ryan October 26, 2016, 5:00 pm

    Hi MMM,

    Long time reader, first time commenter. Just wanted to commend you for giving and to encourage others to give what they can, whether it be time or money. I donate to the Nature Conservancy each year and plan to leave them a small portion of my estate when I pass.

    Reply
  • RPCV October 26, 2016, 5:00 pm

    Bravo! Thank you for sharing this inspiration. I applaud the focus on health and poverty – especially in the developing world. Infectious diseases like malaria and schistosomiasis are killers and some simple interventions can be very powerful.

    I also think that childhood malnutrition and food security fit in this category – sadly, even in 2016, millions of children develop kwashiorkor, marasmus and other severe acute malnutrition.

    My favorite charity is Project Peanut Butter – produces and distributes fortified peanut butter across several African countries with a high prevalence of malnutrition. Huge impact on decades of subsequent life for these children and for a modest cost.

    http://www.projectpeanutbutter.org/#home

    Reply
  • Dean October 26, 2016, 5:06 pm

    I have been hoping you’d discuss this intersection of charitable giving and FI for a long time. It is so easy to get caught up in saving that we have to remind ourselves wealth accumulation doesn’t necessarily mean it all has to go in our own bank account. Conversely,, I have often been conflicted about whether to give even more now or to perhaps let it accumulate over a lifetime and leave the legacy of an endowment to a worthy cause. Imagine a charity being able to withdraw 4% forever…now that could be a huge impact!

    Reply
  • Dan October 26, 2016, 5:09 pm

    For several years now I have been re-loaning $2000 in micro-loans on Kiva, so that I have made a total of $19000 in loans by re-lending each time I am paid back. Seems like a lot of bang for the buck…

    Reply
  • jlcollinsnh October 26, 2016, 5:13 pm

    Thanks Mr. MM…

    We’ve been thinking about adding a couple of new charities to our short list, but have been overwhelmed by the options.

    You’d given us some great ideas and at least three we’ll very likely add.

    We try to keep our charities few and the gifts to each larger on the theory that lots of small gifts have too great a percentage eaten up in the cost of processing.

    But there are so many great ones worthy of support…

    Reply
    • jlcollinsnh October 26, 2016, 5:18 pm

      BTW, an alternative title for this post:

      “What I bought instead of that new Tesla” ;)

      Reply
  • RocDoc October 26, 2016, 5:15 pm

    Great job MMM!
    You are my hero!
    I like that you dispersed the money to so many different types of charity. You obviously put a lot of thought and care into your choices. I and my husband are also financially independent, partially thanks to your influence and partially thanks to oversize salaries. You’ve inspired us to give more too! (We have been decidedly stingy in the giving department up until now-not certain why.)

    Reply
  • Mike October 26, 2016, 5:19 pm

    For those of us still working (like me) check in with your work about donation matching to increase effective giving…not huge at my work, but they do match up to $300 a year so I at least do that every year.

    Reply
  • Kat October 26, 2016, 5:31 pm

    Loved this post, MMM.

    We are moderately frugal livers who still have a mortgage but are otherwise debt free. We do give $$$ to charity out of personal conviction as well as religious belief. With that in mind, we also volunteer time. I do not think there is a one-size-fits-all model here but this splurge in our eyes has certainly given us as much if not more joy than any other thing we have purchased. For us, it works. Please continue to share as you give! It’s interesting to read your how and why.

    Reply
  • Michael October 26, 2016, 5:52 pm

    It would be difficult, if not impossible to find a greater need than diet and nutrition. The diet we eat affects every facet of life on this planet: our health, mental and emotional wellbeing, the environment (oceans, rivers, drinking water, the soil and air we breathe) (2), energy levels, mental clarity, our finances and every other living being on the face of this earth.

    Around 100,000 people claim bankruptcy every year owing to medical bills. And we now know 90 + percent of all diseases are directly related to lifestyle choices (1); the greatest impact being diet. It’s been proven that heart disease, type 2 diabetes, high blood pressure, constipation and a host of other issues can be ended and in many cases even reversed. People have cured MS, cancer, acid reflux, depression, anxiety, and as we continue to research it appears there is almost nothing it cannot cure.

    1. http://nutritionfacts.org/ (100% non-profit organization – daily free talks summarizing medical studies)
    2. Cowspiracy (how food choices affect the plannet – https://www.youtube.com/watch?v=wEk7KFMc-V4)
    3. Forks Over Knives (health – https://www.youtube.com/watch?v=O7ijukNzlUg)

    Reply
  • Diego October 26, 2016, 5:59 pm

    My own charity option is thelifeyoucansave.org itself. They say their estimate is that every dollar they spend on their operations generates 4 to 5 dollars in new donations to their most effective charities. I belive that even if they are wrong by a factor of 2, it is still the best place to put my money on, and since it’s almost for sure this new donations drain money away from unnecessary stupid comsumption, it’s a win-win! Check https://tlycs.networkforgood.com/causes/3949-the-life-you-can-save?_ga=1.178361900.921258967.1477526073

    Reply
    • Diego October 26, 2016, 6:32 pm

      And about donating becoming easier as time passes: You are right! By the type of personallity you seem to have, soon it will become so clear that there could not possibly exist any better use of your money (other than creating something yourself, like tou said, and try to outperform the best charities out there. I’m comparing it to the Tesla and Gulfstream thing) that you keep wanting to give MORE! It is hard to this when you are scared about your own finacial wellbeing, though.

      Reply
  • Debbie October 26, 2016, 6:00 pm

    I was so excited when I saw you had written a post about Effective Altruism, Peter Singer, GiveWell etc. I learned about Effective Altruism a few years ago and love the concept. I have read several of Peter Singer’s books and had the privilege of listening to him speak and attending a workshop run by him (being a fellow Australian). I have attended Effective Altruism conferences the past 2 years and learned a lot about the needs of others and how we can help them.

    My financial situation is very different to yours. I have been a stay-at-home mother and carer to my disabled daughter for most of my adult life. I receive a carer’s pension from the government, have no superannuation, have only small savings and we have nearly finished paying off the family home, but I still contribute to GiveDirectly each month because there are so many people in the world worse off than me. We have all we need, so many do not.
    Keep up the good work and spread the word about Effective Altruism!

    Reply
  • Jack October 26, 2016, 6:28 pm

    A few suggestions for consideration in the future.

    Americares has delivered more than $12 billion in quality medical aid and innovative health programs to 164 countries, including the U.S.

    The Southern Poverty Law Center is dedicated to fighting hate and bigotry and to seeking justice for the most vulnerable members of our society by using litigation, education, and other forms of advocacy.

    Reply
  • Jackson October 26, 2016, 6:29 pm

    Big props to MMM–not just for trying to do good with $$–but for being transparent in reporting where his donations went. As he surely knew, the PP donation would raise some hackles–as I’m sure the ACLU gift did, but MMM is a man of principle and opened his life up to the readers of the blog. Thanks for doing that. And while I may or may not agree with any of the organizations MMM donated too–that’s hardly the point. This isn’t about his politics, this is about how a family that has achieved FI can continue to do good and make the world a better place–and by the way, make themselves feel a little good in the process–thus inspiring them (and others) to give more. Keep the good advice coming MMM…

    Reply
  • Chris F. October 26, 2016, 7:02 pm

    Here’s to you and your family for your generosity. Balancing charity and frugality might be tough.
    That is an excellent list, many of which I donate to using payroll deductions. I have a recommendation for a charity that is non-obvious. Like public libraries or the Wikipedia Foundation that support open access to knowledge, the Free Software Foundation supports open access to technology. I’m not affiliated with them, except as a donor. It has take me years to fully appreciate the dangers of proprietary licenses, patents, copyrights and digital rights enforcement. How easily the world could lose free access to computer technologies to governments or corporations.

    Reply
  • GL. October 26, 2016, 7:11 pm

    Dear MMM,
    I applaud your desire to give well to worthy causes but am underwhelmed by the amount. You have said yourself that your own material needs were met a long time ago and you admit to being in the top 10% owning 75% of the wealth. With that in mind do you seriously consider that you have given generously? Admittedly, it is the top 10% who give the most in dollar figures to charitable organizations but the truly generous heart tends to be those who know what it is to struggle every day to pay the bills & put food on the table and out their own struggle give, a pittance by your standards, a true sacrifice by the standards of the lower 75%.

    Regards, & keep up the good work.

    Reply
    • Kyle October 27, 2016, 5:03 am

      What % of your income to you donate, GL? Or % of your net worth?

      Reply
      • GL. October 27, 2016, 9:13 am

        I give 10% of my net worth.

        Reply
  • Deborah October 26, 2016, 7:27 pm

    Thanks for another great post on how to be wise with money.
    My current favorite charity is the Himalayan Cataract Project, which I first read about in the NYTimes:
    http://www.nytimes.com/2015/11/08/opinion/sunday/in-5-minutes-he-lets-the-blind-see.html?_r=0
    For just $25 per patient, cataracts are removed and sight is restored.

    Reply
  • Chasesfish October 26, 2016, 7:30 pm

    Regarding the use of Charity Navigator, I’ve actually found that using guidestar.org’s free site and pulling the not for profit tax returns are a great way of evaluating charities. I look for solid cash reserves and relatively modest officer’s compensation. Nothing bothers me more than a charity setup to enrich the founder(s) through 150k+ salaries per year

    Reply
  • Courtney Turner October 26, 2016, 7:31 pm

    Bravo MMM! I love hearing about your feeling of lightness (and rightness) after putting the checks in the mail. The timing is perfect, too, because Christmas is coming up.

    Some in my family forgo gifts in lieu of sending bigger donations to charities they believe in. It’s lots of fun to plus up donations, even way up. Near or far, do your research and then get the checks in the mail!

    I’m a big supporter of the Salvation Army, literacy organizations, and the like. Action beats talk, every time!

    Reply
  • Bryan October 26, 2016, 7:36 pm

    Apopo is a very worthy charity, in my opinion. They train Gambian pouched rats to sniff out explosives (land mines) as well as Tuberculosis. They are also looking into training them to sniff out cancer. The relatively low cost compared to humans, as well as their speed, has made them the best option in places like Cambodia, Mozambique, Thailand, Angola, Tanzania…

    https://www.apopo.org/en/

    Also, they’re really cute.

    Reply
  • Kayote October 26, 2016, 7:42 pm

    Two charities I think do very good work are Heifer International and Modestneeds.org.

    Heifer works around the world to combat poverty through both gifts of animals (or plants) and the training required to successfully farm with the animals–integrating them often into permaculture, improving women’s status, and bringing communities together by requiring a recipient give away one of the offspring to someone else–and that continues. I like the long term thinking and the community and environmental aspecs.

    Modestneeds.org tries to stop the cycle of poverty before it begins. People who are living paycheck to paycheck who get that unexpected bill that will take them under (the car breaks down, they can’t afford to fix it, but that will lose the job and then the house, need to come up to date on union dues to start a new job, etc). I really like the idea of helping someone before they lose everything, to interrupt that downward spiral before it really starts. Many recipients become donors, which I also find an excellent thing.

    Reply
  • Juanita Neitling October 26, 2016, 8:09 pm

    My husband, Dave, and I are retired. We give about 25% of our income to charitable causes, mostly local organizations. My husband, especially, gives hundreds of hours of physical labor each year, maintaining local parks and trails, building houses with Habitat for Humanity, preparing tax returns with the AARP tax aide program. In addition, we support one of our children who needs the help. Our philanthropic focus is primarily local because we know the people who are doing the projects and often there is little or no overhead. I feel that if we don’t contribute, our community will not be as good as it is, we enjoy the appreciation of those who know of our efforts and we need to model generosity so others will see how it is done and what good it can do. We really don’t need all the money we get each year but others can benefit from our modest lifestyle. What a good column you wrote today.

    Reply
  • Laura October 26, 2016, 8:24 pm

    I found this post really fascinating, and in all honesty, really overdue (discussing philanthropy in general, not your own choices about it). I’ve always thought it was slightly hilarious to be reading your blog and have made a career in the nonprofit field where most of my co-workers are not thinking about this stuff at all. Most wonder how they can ever retire and complain about the low wages, though to be honest I think that as modest and humble as most of them are, they would probably be some of the best at living the MMM lifestyle.

    At any rate, I find people’s philanthropic choices to be absolutely fascinating because they say a lot about who we are and what we value as people. You talked about the “efficiency” ratios, which doesn’t surprise me as an efficiency-oriented person. But I’m glad that you decided to think more critically about that and select a lot of organizations that had personal significance to you. At the end of the day, when someone–anyone–makes a contribution, they’re entrusting others with that contribution, and it’s about human connection and the heart. There’s no way around that. I think anyone who thinks they can find the “perfect charity” to donate to based on numbers and ratios is usually just terrified by the idea of giving their money–without any tangible return–to others to manage and do what they will with. What is it about money that makes some of us so controlling?

    Having worked in the nonprofit sector for years now and gotten my masters in nonprofit studies, I can tell you that there is no perfect charity or right or wrong for giving. Every organization is run by people. And that’s not just to say that people make mistakes, but that people have their own paradigms and conceptions about how the world works and how we need to change or “fix” it. So you just have to find those that resonate with who you are. I think you’re doing it right.

    The last thing I’ll mention is something that I think you’ve discussed a lot without saying it outright. Volunteering with the organizations you donate to is often the best way to figure out how much, and to what, you want to contribute. To my earlier point, there’s nothing you can do to ensure that your money is spent “perfectly”–it still involves a degree of trust and letting go. But if you yourself can engage in the work, you can help make the vision come true.

    Reply
  • chad October 26, 2016, 8:27 pm

    MMM, I’ve been eagerly awaiting your wisdom on the issue of charitable giving, having picked up on the clues here and there that it was something you were trying to think through carefully. This is a great post, and a very impressive and generous thing you’ve done. Congratulations on that! Let me just say that I for one hope that you continue to think about this issue and share your conclusions about the very best way for all of us to give. One thing that really bothers me is the way in which the countries that have received some of the highest levels of charity have declined so badly at the same time. E.g., Dambisa Moyo, an African economist, reports that “Between 1970 and 1998, when aid flows to Africa were at their peak, poverty in Africa rose from 11% to a staggering 66%”. This is very upsetting, and makes me feel uncertain about whether giving to alleviate extreme poverty might not really somehow be exacerbating the problem. Anyway, my main point is: keep thinking and sharing your analysis with us!

    Reply
  • Nice Joy October 26, 2016, 8:28 pm

    Most of the US charity deductions go to religious institutions [ for its upkeep and updates] . Shameful to these institutions. STOP donating to Religious prosperity.

    Reply
  • Drew October 26, 2016, 8:51 pm

    I looked through the links, watched the TED talk and scouted out some links from there as well. However, what I’m most interested in is slowing climate change. So many of the charities are US-focused (including NRDC) and I find it hard to believe those are the most effective dollars spent in reducing greenhouse gas emissions. You’re a great advocate for reducing our impact on the natural world — do you have any recommendations from your charitable giving research for those of us interested in environmental causes?

    Reply
    • Adam October 27, 2016, 1:50 am

      NRDC is good stuff. They are right up there with Sierra Club in organizations that have the clout and resources to fight fossil fuel polluters through legal, PR and mobilization on a national level.

      Reply
  • Huck October 26, 2016, 9:21 pm

    Our school, the ‘hood, Longmont and the world are a better place because of folks like the MMM family…thanks Pete!
    We are tithers like you mention and very happy to excercise the discipline of regularly and systematically giving through the local church. Some churches are even so bold as to offer money back guarantee if you try tithing for 90 days and decide it’s not for you. But the real fun comes after the tithe…what you give beyond that is exciting and addictive as you have obviously experienced!
    Again…thanks!!

    Reply
  • Kristen October 26, 2016, 9:34 pm

    Thank you for reminding us we can deliberately choose to step up and share, to offer help in the midst of a nation that privileges profit over people and land. All of our situations are different and uniquely our own, but that allows us to be creative with our charity, whether it is with money or our time. Any contribution of good from each of us, no matter how small or large, can start to collectively tip the scales toward a sustainable society for the future. Your charity choices are completely personal and I respect that. My one question: from previous blog posts, I get the impression you love the natural world and appreciate our wild places. I see that 10% of this donation went to environment, which seems relatively small. In the end, it may be solitude and wildness the that the future will thank us most for conserving. Otherwise, we are on a path where we will put our own greatest experiences on extinction the further we destroy the natural spaces we have left.

    Reply
  • Kathryn October 26, 2016, 9:53 pm

    Hi MMM
    Re: your YouTube idea, I think you could definitely do that yourself without having to hire any fancy professionals. You have all the content already and I think people appreciate your no-frills style. The presentation you shared a few weeks ago was excellent. You’re right, it would be reasonably time-consuming, but it would be a great way to reach people who aren’t so great with reading. Perhaps you could slowly turn your most popular blog posts into videos?
    Great work on giving away your money and for choosing such worthy causes. Love your blog, thank you.

    Reply
  • Roh October 26, 2016, 10:33 pm

    Well done MMM!
    Here is another great charity worth having a look at…
    http://lovelifehope.com/

    Reply
  • Paul K. October 27, 2016, 12:09 am

    Upvotes for Charity: Water and Kiva!

    Reply
  • Joe October 27, 2016, 12:11 am

    Wow, that’s very admirable. Hopefully, I can get there someday too. It’s hard for me to donate because it’s not my family’s culture.

    Reply
  • Josh October 27, 2016, 2:39 am

    For anyone still working, don’t forget to find out if your employer will match charitable donations. Mine does.

    I’ve also been able to amplify the impact of my donation by working with charitable organizations to set up donation matching programs, which help to encourage other donations. People are much more inclined to donate when they know their donation will have double the effect.

    Right now, I’m sponsoring a matching fund for the SENS Research Foundation, a medical research organization working to end aging and age-related degeneration. (Talking about maximizing the number of lives saved, I’m aiming for the long-term goal of saving them all.) We’re trying to get new recurring donors. So, we’re going to match every new recurring donation starting in November with our own, for a full year. See http://www.sens.org/

    Reply
    • Brad Pitcher May 8, 2018, 9:17 am

      Yes! I went through all the comments and this is the only one I found mentioning aging research. With any thought it is extremely obvious that defeating aging will do the most good for the most people. Nearly everyone who has ever lived (and ever will, with current medical technology) suffers greatly from the effects of old age. Not everyone suffers from old age, but they still die from it. That is a huge amount of suffering that can be relieved, not to mention the enormous economic benefit from keeping everyone productive and healthy.

      Reply
  • Denise October 27, 2016, 4:03 am

    MMM

    You asked what would I donate to, to do the most good (from my perspective) for the human race.

    Really tough one, as you seem to have taken a lot of time to reflect on your own choices.

    I was really struck though by how agitated I was at the framing of your question: “the most good for the human race”.

    My immediate thought was “why humans – why not the earth and all beings on it?” I know you have given to environmental causes within this range of donations- I am curious as to whether you experienced agitation or anything akin to that in making your allocation decisions?

    I currently donate mainly to humanity-based causes, but am beginning to skew more heavily to animal and ecological charities as I get older. I need to reflect some more on the “why?” of that.

    Reply
    • Anonymous October 27, 2016, 3:29 pm

      > My immediate thought was “why humans – why not the earth and all beings on it?”

      I’m a fan of environmental causes, but at the end of the day, humans are the only minds capable of making such decisions, and human minds are the most valuable thing to preserve.

      “The universe is neither evil, nor good, it simply does not care. The stars don’t care, or the Sun, or the sky. But they don’t have to! We care! There is light in the world, and it is us!”

      Reply
  • Kevin October 27, 2016, 5:12 am

    I applaud what your are doing. That said, a little money to the Veterans that fight to keep this country free would have been nice.

    Reply
  • Brian October 27, 2016, 5:18 am

    Much good can come from the financial contributions but too often administrative costs within the charities absorb a good portion of the donation. It becomes a feel good exercise, with the giver knowing he really wont miss that money, but honestly wants to do something for a cause. Money is infinite, the donor can always make more, but time is finite. To give of one’s time, to physically give blood, serve meals to the homeless, assist at a seniors center, drive the elderly to doctor’s appointments, drop off used clothes to a shelter or simply buy a meal for the man sitting on the sidewalk asking for coins, is equally as charitable, but you can see the results in person, knowing what you have done makes a difference. Not everyone has the ability to give away ” excess cash”, but everyone has the ability to give of their time. It just takes a bit more effort than writing a check.

    Reply
  • chasesfish October 27, 2016, 5:24 am

    Have you looked into the Longmont Community Foundation? Vanguard/Fidelity are pretty good for donor advised funds but you can also set these up with local community foundations. At the level of money you’re giving away, you could annuitize support for local charities based on your 4% rule.

    Reply

Leave a Reply

To keep things non-promotional, please use a real name or nickname
(not Blogger @ My Blog Name)

The most useful comments are those written with the goal of learning from or helping out other readers – after reading the whole article and all the earlier comments. Complaints and insults generally won’t make the cut here, but by all means write them on your own blog!

connect

welcome new readers

Take a look around. If you think you are hardcore enough to handle Maximum Mustache, feel free to start at the first article and read your way up to the present using the links at the bottom of each article.

For more casual sampling, have a look at this complete list of all posts since the beginning of time or download the mobile app. Go ahead and click on any titles that intrigue you, and I hope to see you around here more often.

Love, Mr. Money Mustache

latest tweets