6 Strategies Retirees Can Use When Donating to Charity This Holiday Season
Written by
Gabriel Vito
Edited by
Amber Barkley
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The holiday season is a common time for retirees to give back. With more time and financial stability, many retirees find this season is the perfect chance to support causes close to their hearts.
However, strategic planning can make charitable contributions more impactful — for both the donor and the recipient. By understanding smart giving strategies, retirees can maximize the joy of giving while ensuring their resources are used effectively.
Choose Causes That Align With Your Values
The first step in meaningful and impactful giving is identifying causes that reflect your values. Whether it’s supporting education, healthcare, animal welfare or the arts, choosing a cause that resonates with you ensures your contributions make an impact, big or small.
For example, if you’re passionate about literacy, you might support organizations that provide books to underprivileged children. If you’re passionate about animals, you can consider donating to your local animal shelter.
Focusing on what matters most to you makes giving more personal and rewarding.
Volunteer Your Time
Donating doesn’t always have to mean giving money. Your time and skills can make a positive impact, as well. Many retirees find purpose and connection by volunteering for causes they care about.
Volunteering offers mental and physical health benefits, as well as opportunities to stay socially engaged. You can consider volunteering at a local food bank, mentoring students or helping out at a community center during the holiday season, for example. Volunteering your time in person allows you to see the impact you’re making on your chosen cause first hand.
Consider Donating Appreciated Assets
Donating appreciated assets, such as stocks, mutual funds or real estate, can be an effective alternative to writing a check. In addition to benefiting the cause you care about, this option also comes with valuable tax advantages.
For example, by donating these assets, you can avoid paying capital gains taxes and still claim a deduction for their full market value. It’s a win-win that increases the impact of your donation while potentially lowering your tax bill.
To make the most of this strategy, it’s always a good idea to consult a financial advisor who can guide you through the process.
Qualified Charitable Distributions (QCDs)
If you’re aged 70 ½ or older, qualified charitable distributions (QCDs) offer a tax-efficient way to give. A QCD allows you to donate directly from your IRA to a qualified charity, satisfying your required minimum distributions (RMDs) while excluding the donation from your taxable income.
This strategy is particularly beneficial for retirees who don’t itemize deductions but still want to give back. Note that annual QCD contributions are capped at $105,000 in 2024, so plan accordingly.
Get the Family Involved
The holiday season also offers a great opportunity to bring your family together through charitable giving. Turning generosity into a family tradition can strengthen relationships while teaching younger generations the importance of giving back.
You might volunteer as a group or work together to choose a charity to support. For instance, let your grandchildren pick a cause they’re passionate about and use it as a chance to show how donations can make an impact. Sharing these experiences creates meaningful connections and adds a deeper sense of purpose to the holiday season.
Vet Charities Before Donating
Before making a donation, take the time to research charities to ensure your contributions are used effectively. Resources like Charity Navigator and GuideStar can provide valuable insights into an organization’s financial transparency, impact and other details you can assess that may align with what you’re looking for.
Reviewing these details ensures your donations go to trustworthy charities that maximize the value of every dollar to make an impact on a cause that aligns with your values.
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