What’s In Your “Giving Portfolio”?

A Different Take on Asset Diversification

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By Rick Kahler; MS ChFC CCIM CFP®

Salvation Army bell ringers – Angel trees – Appeals in the mail from charities, churches, and community organizations. Office and club gift exchanges. The family Christmas, or holiday list, that expands year by year.

This time of year, the spirit of giving gets a serious workout. For some of us, it can quickly turn into a spirit of frustration as we feel overwhelmed by requests and obligations.

Maybe one answer to make the season more manageable is to become more conscious about your giving by creating a “giving portfolio.”

As regular readers of the ME-P know, one of my constant themes when it comes to investing is diversification. Don’t put all your eggs in one basket. More than that; don’t put all your resources into eggs in the first place. It’s essential for a portfolio to have a good mix of investments in a variety of asset classes.

Thinking along those same lines, what are some of the “asset classes” that might be part of a diversified portfolio of giving? Here are a few:

Family: Giving to family could include direct gifts for birthdays, Christmas, and other occasions. It might also involve financial support to family members, such as helping elderly parents with expenses or paying part of kids’ college costs.

Charities: Pick any cause, and there’s probably an organization for it. You can give locally, nationally, or internationally to organizations such as food banks, homeless shelters, the Red Cross, Save the Children, and others that help provide basic help for the poor and victims of disasters. Local groups do everything from buying school supplies to providing help for individuals with serious illnesses.

Arts Organizations: In Rapid City and the Black Hills area, as an example, we have community theatres, summer theatre, the symphony, concert associations, and fine arts centers.

Religious Organizations: This isn’t limited to churches or synagogues, but might include retreat centers, mission organizations, and other ministries.

Community Organizations: This might include service clubs and other groups that aren’t primarily charities but that support their communities in various ways.

Educational Organizations: Everything from baking cookies for the PTA bake sale to sending money to your alma mater would fit here. So might supporting agencies that provide tutoring, summer camps, or scholarships.

Healthcare Organizations: You might donate to groups such as the American Cancer Society that fight specific illnesses, support efforts to eradicate diseases like malaria, give to research organizations, help with housing for family members of hospital patients, or support a local hospice center.

Just reading this list is probably enough to give you a strong urge to grab your wallet and run. Trying to choose among so many worthy causes can feel as overwhelming as trying to pick the right mix of mutual funds for your investment portfolio.

Well, here’s something that might make you feel a little better. Unlike investing, wise giving doesn’t require you to be diversified.

Other Valid Options

You certainly can give in a diversified way if you wish, selecting a mix of giving asset classes just as you might choose investment asset classes. Maybe you want to allocate half your giving dollars to family, 20 percent to your church or synagogue, and 10 percent each to a health research agency, a food bank, and your community theatre.

Or, maybe, on the other hand, you want to dedicate your entire giving budget to family. Or, even 75% of it to a local homeless shelter. Or, give primarily through your church or other place of worship.

Assessment

All those are perfectly valid options. The key is to make your giving choices deliberately, not impulsively or out of guilt. Creating a conscious giving portfolio helps you give in ways that match your values and support the causes you care about.

The Author

Rick Kahler, Certified Financial Planner®, MS, ChFC, CCIM, is the founder and president of Kahler Financial Group in Rapid City, South Dakota. In 2009 his firm was named by Wealth Manager as the largest financial planning firm in a seven-state area. A pioneer in the evolution of integrating financial psychology with traditional financial planning profession, Rick is a co-founder of the five-day intensive Healing Money Issues Workshop offered by Onsite Workshops of Nashville, Tennessee. He is one of only a handful of planners nationwide who partner with professional coaches and financial therapists to deliver financial coaching and therapy to his clients. Learn more at KahlerFinancial.com

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One Response

  1. Health Blog Video: Is it True Giving is Good For Your Health?

    ‘Tis the season to give. But can generous acts benefit your health?

    http://blogs.wsj.com/health/2011/12/19/health-blog-video-is-it-true-giving-is-good-for-your-health/

    Hope Rachel Hetico RN MHA

    Like

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