By Vicki
On this Giving Tuesday, we’re focusing on our aging parents and their charitable giving. We’ve already written about senior citizens being serious targets for financial exploitation, sharing ways to help protect your parents from losing their hard-earned money.
While we are passionate about helping our parents avoid becoming victims of scams, we also want to make sure they aren’t spending more than they can afford to support legitimate organizations and causes that matter to them.
When their finances can support charitable giving, there are things you can do to help them maximize their donations. But if your parents struggles with money or if you’re trying to find ways to help your aging parents financially, it’s important to talk to them about their giving and look at their eligibility for charitable support.
Helping Your Aging Parents With Money is a new series highlighting financial topics you may need to discuss with an aging parent or relative. It was inspired by recent events in our own lives and Cameron Huddleston’s new book, MOM and DAD, We Need to Talk. (We are big fans of Cameron’s book; you can read our review here.)
If you’ve always discussed important issues openly with your parents, bringing up financial topics probably won’t come as a surprise. But if money talk has been taboo through the years, you’ll need to tread lightly. There are a lot of emotions around money, and aging parents may be very concerned about sharing details of their financial lives.
In this series, we’ll talk about money conversations we’ve had with our parents and close relatives. Feel free to add to the discussion by adding comments or asking questions.
Checking Charities Your Parent Supports
It might surprise you that there are over 1.4 million non-profits registered in the United States. Many people who donate support both local and national organizations. And some also give to international charities that make an impact around the world.
Your parent is probably safe giving a reasonable amount of money to their church, buying items from a neighbor child’s school fundraiser, donating to a local soup kitchen, or purchasing some Girl Scout cookies.
But they should use unbiased rating sites like Charity Navigator or Charity Watch to check on other organizations they plan to support. They want to look for charities where most of their donations support the cause and not administrative costs and marketing.
If your aging parent isn’t tech-savvy, this can be a great reason to start a discussion about their charitable giving. If they aren’t happy with how a non-profit is spending their donations, they can make different decisions about financial gifts.
When Their Finances Support Giving
Aging parents that have their financial house in order may have plenty of money to support charities of their choice. But that doesn’t mean you can’t share information or ask questions either.
Whether your parent has automated their giving or not, they may need to take time to review how much they are donating to each organization. And whether they are other charities they’d rather support.
Changes to tax laws in recent years may impact whether your parents have enough itemized deductions to meet the threshold set by the IRS to deduct charitable contributions. They may need help from you or a financial professional to figure out qualifying for tax breaks for their donations.
A parent may want to consider a donor-advised fund (DAF) which is like a charitable investment account. In addition to cash, your parents may even be able to contribute other assets and still be eligible for a tax deduction. While some companies require initial donations of at least $5,000, you do have flexibility about when to actually send the money to a charity.
Charities can also be a part of your parent’s estate plan. Ensure your parents seek tax advice and work with an attorney experienced in estate planning to determine which strategies will benefit all parties involved.
When Some Charitable Giving Makes Sense
If your parent is on a tighter budget as they age, they may still have room for some charitable giving. But it makes sense for them to keep track of how much they donate so it doesn’t impact their overall financial wellness.
A parent who is used to helping others may not realize how often they are asked to give to charities.
A couple of dollars each week to a food bank, buying wreaths and candles from a local youth club, a GoFundMe to support a family in town, and solicitations in the mail for end of the year gifts from numerous national organizations can wipe out a giving budget fast.
If they are able to donate personal gifts like blood or give time to help a charity, a parent can also consider doing that in addition to the financial gifts they can afford.
When Financial Gifts Need To Be Limited
Even though many of our parents can support charities of their choice, some older adults donate to numerous charities. This can put their own financial health at serious risk.
If you know your parents don’t have much money to give or if you have concerns that they are donating to too many organizations (or giving too much to a few), talk to them about your concerns. They may need to prioritize their giving and limit the amount they spend.
Some parents may need to put off giving until they are in a better financial position. Others may actually be in need of charitable support themselves.
If your parents need financial assistance, urge them to take advantage of any help and charitable gifts they are eligible for. In addition to federal, state, and local programs to assist seniors, there are non-profits to consider in many regions.
Check out the Alzheimer’s Association, Meals on Wheels, or the Honor Flight Network for Veterans. While growing numbers of seniors put strains on the budgets of some charitable programs, it’s still important to access help for seniors when they need it.
Final Thoughts on Your Aging Parents and Charitable Giving
Your parents may not need help navigating charitable giving now. But as they age, their ability to manage their finances and make sound decisions about donating their money may fade.
Older adults may have a harder time saying no when asked for money. Or they may feel a need to help a person or an organization when they really can’t afford it.
This can also happen when they are more vulnerable to scams by someone trying to steal their money. In combination, your aging parent’s finances can be seriously impacted in a very short period of time.
Be gentle when you bring up your parent’s charitable giving. They are more likely to listen to you if you assure them you understand they want to help others, instead of telling them to just stop donating or “wasting” money giving it to charities. Then help them navigate the process.