Automatic Giving
Do you give regularly to a church or other charitable organization? Plenty of organizations depend largely on donations from the public, and many individuals feel as though they have a responsibility to support the causes they believe in. Most financial experts agree that a well-rounded personal financial picture includes some charitable giving. For some people, the giving is to get a tax deduction while for others it’s to do some good.
If your charitable giving includes your place of worship then you may have encountered an interesting option offered by some congregations: automatic tithing. You can set up an automatic withdrawal directly from your bank account to your church, and in some instances churches are offering automatic deductions from credit cards. No muss, no fuss, and your contribution always gets there on time.
Is this a good idea? At first glance it may seem like a handy way to contribute to a cause you believe in, but the issue goes a little deeper than that:
Should a tithe or contribution be so automatic that the giver never has the opportunity to reflect on it?
Should places of worship encourage parishioners to set up automatic payments from a credit card, potentially putting the giver deeper in debt?
Some people might argue that there is absolutely nothing wrong with simplifying the act of charitable giving, but remember that a huge portion of successfully managing your personal finances is psychological. If you do give to your place of worship using automatic payments you should at least set time aside each month to reflect on the act of giving. You might do this when balancing your checkbook, for example.
Paying tithes and offerings using a credit card can be a potentially bad situation unless you pay your credit card balance each and every month in full. Some people choose this route because they can earn points and rewards from the credit card company with every purchase, but it should not be used if you carry a balance every month. While charitable giving is an important facet of every personal financial situation, you should not go into debt in order to give to a charity.
Be sure to get a receipt at year’s end from your place of worship so you can deduct your charitable giving when you file your income taxes.
