How to budget for year-end giving without going broke

Budgeting is an important aspect of personal finance year-round, however as the end of the year approaches, these budgeting strategies may come in handy.

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At this point, the research is conclusive: spending money on others makes you happier.

That's not a new idea by any stretch, but it bears repeating as we approach the end of the year. This is the time where most nonprofits and charities are hustling like crazy to meet year-end quotas and cobble together a respectable budget for the following year. So many of these smaller organizations hover on the brink of collapse, and a poor holiday drive could mean shuttered doors.

Unfortunately, year-end giving just isn't in the budget for many individuals. That's not necessarily because they can't afford it, but because they didn't plan ahead to include charitable donations. But with a little forethought, just about anyone can support their favorite cause during the holidays. In many cases, it doesn't even have to cost any money.

If you want to donate to charity this year—but don't know how to include it in your budget, read below for some tips:

Create your overall holiday budget

The holidays are a stressful time of year, full of planned get-togethers and surprise activities. Before you decide how much to parcel out for your charitable donations, look at how much you're planning to spend for the season as a whole.

Your holiday budget should include:

  • Travel, including plane tickets, gas, rental cars, hotels, Airbnbs, and more
  • Food, including any special holiday meals or eating out while on the road
  • Gifts
  • Decorations

Don't forget to add small holiday celebrations into your budget, such as the White Elephant gift exchange at your office or the annual cookie decorating party. Even little expenses can add up quickly during the holidays.

Add up how much you anticipate spending this holiday season and compare that figure to your regular budget or special holiday savings. Then, decide how much money you have left over: that's your charitable giving allotment for the year.

If you're not sure how much everything will cost, do your best to stick to a budget and then wait until the holidays are over to make your donation. That way, you won't be stuck if gas prices jump unexpectedly before your 10-hour road trip and you've already committed $250 to your local NPR affiliate.

Find where you can cut

If there's no leeway between your budget and your projected holiday expenses, it's time to make a few changes. Do you have to get your in-laws presents or can you just exchange cards this year? Do your kids need a new Xbox or can you opt for smaller gifts?

You should also look at how much you regularly spend on eating out, going to movies or concerts, subscription services, and shopping. Are there any areas where you could cut back and use the difference for your year-end giving? You don't have to make the changes permanent: even a temporary freeze could free up some room in your budget.

Parents can use this opportunity to teach their children about why giving to others is important and why they're making it a priority. If you donate to a local organization, consider doing it in person and bringing your kids with you so they can witness the impact. This will help children understand why you're not going out to eat as much or why they can't have a new video game every month.

Start a monthly giving plan

While many people assume they can only give a lump sum, many organizations will set up monthly giving plans at your request. That way, you can donate a little bit on a regular basis.

You can usually do this on the nonprofit's website. They'll ask for your credit card or bank account information, which they'll use to set up monthly withdrawals for an amount you choose. You can decide to contribute as little or as much as you want. Some employers will even do this for you on your paycheck.

Even though it might seem odd to donate $10 a month instead of $100 at the end of the year, think about it this way: You wouldn't make a one-time contribution to your 401(k), so why do it with charitable giving? At the end of the year, it won't matter if you gave $100 all at once or bit by bit.

My husband and I set up auto-donations last year, and it really helps keep us accountable as charitable givers. Instead of having to make a yearly choice of whether or not to give, annual giving is just another bill we pay.

Give your time

If you've gone through your budget and don't have any extra money to give this year, don't despair. Yes, charities rely on external donations, but many also need volunteers as much as they need hard cash. Contact the organizations you support and ask them what their volunteer needs are. Some are flexible and have many slots available, while others are more rigid on when and where they need help.

As a former nonprofit employee, I know there are many events and services we could never have done without the help of our volunteers. If someone generously gave their time, we were just as grateful as if they donated money.

Encourage others to give

For people who can't give as much as they'd like—or just want to give more—they can consider fundraising for their favorite organization. Many people feel charitable during the holidays, but struggle to find a way to help. This is perfect if you're in that situation.

Social media is a great way to get the word out, but nothing is as effective as talking to people directly. You can even hold a physical drive if you know of a charity that's looking for specific items, such as an animal rescue shelter looking for old towels or a women's shelter looking for toiletries. This way, you can declutter your house and help out your favorite mission at the same time.

By supporting your organization publicly, you also spread their message and introduce their mission to new people who might become fervent supporters. Never underestimate the power of free publicity.


Charitable giving at the end (or throughout) the year, doesn't have to drain your bank account. If you're smart about budgeting and set aside a small amount each month for donations, you should have no problem giving a sizable year-end donation. And, if you just can't afford to give, your time is just as valuable.

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Article copyright 2017 by Money Under 30. Reprinted from the December 11 issue with permission from Money Under 30.
The statements and opinions expressed in this article are those of the author. Fidelity Investments cannot guarantee the accuracy or completeness of any statements or data.
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