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Should You Have an Emergency Charity Fund?

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[Editor's Note: I published this originally in June of 2008. It's helped me save money to give Haiti, Japan, Hurricane Irene victims, and that Sandy thing that people are talking about today. Even if you put $3 to $5 aside a month for charity disaster relief, you can make a big difference.]

It's no secret that one of my favorite blogs is Get Rich Slowly. Yesterday there was an article about how to coping with financial disaster. (My short answer see #14 of 16 Thoughts on Oprah's Stanford Commencement Speech... Grieve properly, attend to the situation at hand, and get back to what was important before the crisis.)

With more and more natural disasters striking the United States, it occurred to me... should I have an emergency fund to donate to charity? I typically focus my charitable efforts on one effort... the American Cancer Society... in honor of my dad. Perhaps that doesn't make sense anymore. Perhaps I should "plan" for one or two disasters each year... whether it be wild fires, flooding, hurricanes, or tornadoes.

I think in the future, I'll look to divide my charitable contributions in three ways... I will still support the American Cancer Society, I don't see that ever changing. However, I will divide the other half of my charitable contributions to charities are more directly observable by me. I'm thinking that one of those sites is Kiva.org. The other would be this emergency fund for natural disasters.

I suppose there's no right or wrong answers when it comes to charity and giving, but as always I'm curious to hear what you think. Do you have an emergency charity fund?

Posted on November 5, 2012.

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18 Responses to “Should You Have an Emergency Charity Fund?”

  1. Momma says:

    What a fabulous way to plan your purposeful giving. This definitely made me think of my charitable contributions in a way that I hadn’t before. Thank you :)

  2. Joshua says:

    I do not have one right now. But after thinking of your idea I came to the conclusion that its a good idea. Everyone with spare income should have a charity that they give to. Right now I give to OPARC which helps with developmentally disabled adults who have conditions such as downs syndrome. I think its a worthy cause but I never thought to have a fund for such things as disaster funds. We had really bad fires about a few miles from my house a few years ago and I had a lot of friends that were evacuated. It would have been nice to have a fund readily available to give to them.

  3. Solomon says:

    I don’t have a fund as such, but I do lend on Kiva, and have been for about a year now.

    I like Kiva because the same money can help multiple people. When someone repays a loan, I can lend it to someone else. If I give to charity, I can only help someone once.

  4. CommRE says:

    I do have a Charity savings account. Not sure it is an “Emergency” Charity account, but it is where we pull money from for larger donations. For me, that is anything $500 or over. Anything less than that I just pay from our regular checking. My wife and I set the money aside after a settlement and keep it in an online savings account.

  5. Seth says:

    My wife and I put aside some money each month for charity. If a friend wants $20 for some a-thon, the money comes out of it. When people pass the hat for a friend in need money comes out of that. Its not an emergency fund per se, but it has enough so when we want to give away $50-$100 we don’t have to think if we can give.

  6. Mobody says:

    I think an emergency fund for charity giving is really a good idea. Most people are givers for charities because they have some tie to it, Cancer, United Way, or what have you.

    I volunteer for a group that sends kids to Latin America to do service projects, kind of like a “mini peace corps”. They mostly do clean water projects, hygiene and healthy household projects, etc. The kids fundraise to pay for the program, which costs about 6K per person to go down for eight weeks and pay for project materials.

    I hear a lot of excuses as to why people can’t donate. We give to this or that fund, or how can you bother with that when there are tsunamis and 911s and hurricaines and any number of unexpected disasters.

    The truth is, because a lot of people don’t plan their charitable giving, they will opt to send money to the Red Cross for the Tsunami, and not give to the cancer fund this year. Actually, they should give to both, and with a fund like this, they could.

  7. Mary Sue says:

    I donate a portion of my income to several charities as required by my religious practice. I send a small dollar amount every pay period to an international charity that focuses on relief and development work throughout the world. I mark the donation “Area of Greatest Need”.

    The area of greatest need is often on the front of the charity’s web page. In December, it was the counties here in Oregon hit hard by flooding. In March, it was Kenya. Last month it was the cyclone-hit parts of China. This month, it’s the Midwestern states. Natural disasters strike every day across this wide world of ours, and a constant donation reminds me that I am a citizen not just of the United States, but of the planet Earth.

    (God, I sound like such a hippie.)

  8. Lazy Man says:

    “donate… as required by me” – I usually replace that phrase with the word “fee” or “subscription”, but I suppose there’s a difference to the IRS ;-).

  9. Andrew says:

    I don’t have an emergency charity fund, but that’s because I make it a regular habit of giving to charities. If I can suggest a few: my college (or in your case, yours) my church (or yours), Doctors Without Borders, Environmental Defense Fund, Friends of the Urban Forest (San Francisco), and Glide Memorial Church (San Francisco).

    Hell, if any of these contributions make a difference (as in EDF), then maybe the number of natural disasters will go down somewhat, and these “emergency” donations will slow.

  10. What a fantastic idea! I had never thought of having a fund already pre-specified as “donated” in case of emergency. It is almost like a charitable trust fund for regular people.

    If you do have a little more money to donate than most, you might consider that Vanguard has a charitable trust arm that requires a minimum $25K investment or you can have five people combine $5K each. You receive the tax deduction now, but can specify where to give it later.

  11. I noticed an article on CNN today about a charity that tries to arrive first to a disaster with special equipment for clean up and rescue. See: The First Response Team Website

    That might be a good alternative if you want to give in preparation for a disaster.

  12. Meg says:

    I keep a charitable giving account; it’s just an EmigrantDirect savings account. Part of my budget is to give 5% of my gross income to charity. I have that money automatically transferred each month to my ED Charity account, so when things come up I feel led to give to, I have a pot of money there to dip into.

    Most years I give most of it around the holidays or if a disaster strikes suddenly (like Katrina or 9-11) though one year I had a lot leftover and used it to fund a volunteer trip to Peru.

  13. Melanie says:

    Thank you so much for bringing this idea to light. I give regular percentages of my net to charities. But I also keep a “Generosity Fund” which is above and beyond charity giving because I value generosity. Money accumulates in this account, and whenever I need it for extra charitable purposes, or I just see or hear of a need among friends or family or friends of friends, I dip into the Generosity Fund. Sometimes it accumlates lots of money- “Let your alms sweat in your hands until you know to whom to give it” (Didache)

  14. matt says:

    Saving money to give later defeats the whole point of giving money. You give a percent of your income, your income changes and your giving reflects that. If there is a large issue, you dig deaper and go without. Leaving money in the bank helps no one!!

  15. Lazy Man says:

    I guess it depends on what you believe. I think that saving money and earning interest (even if you are just keeping pace with inflation) is fine. The whole point of an emergency fund is to have it when you need it.

    In this time of very expensive gas and food, I don’t think digging deeper and going without is an option for many people.

  16. Two different thoughts – my largest one is pool my money with many others so that large transformational grants are given. Additionally i volunteer in my community… and help increase the awareness of needs so others volunteer also!

  17. robyn says:

    i still put a nickel or a dime or a quarter into a jar for every mile i do on my bike, the money going towards my BikeMS ride. When i collect a debt i have previously written off [some of my clients are deadbeats] i put half of that into the charity jar for other assorted charities. groupon and living social sponosr matching programs now and then, as does my local newspaper. Also, my BF works for BofA which matches all charitable donations up to 5G/year. so if we donate 25 to the red cross through our newspaper, and BofA matches it, it becomes a 75 donation.

  18. We save monthly into a savings account designated for charitable giving, so that money could go toward disaster relief or any other type of giving that we want to do. So while I do see the point of having money on hand to give away as opportunities present themselves, personally I don’t restrict their usage to only disaster relief.

    But if you know that you want to donate to the Red Cross or something similar in the event of disasters, why wait for the event? Why not donate when you have the money on hand at any random time and feel confident that you’ve already helped out when the next disaster comes?

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