How to budget for charity and balance it with your savings

Charity is not a compulsory expense and thus it is usually excluded from budgets. However, if you donate money on the spur of the moment, it could throw your budget off course.

We have a look at how you can budget for goodwill, and we look at how you can give when your income won’t allow you to do as much as you’d like.   

Tip: Have a look at our budget calculator to get started.

Two ways to budget for charity

Altruism has always been popular for religious and/or moral reasons. Today is no different, and charity is often included in modern purchases or marketing campaigns.

“Many more people are taking the time to include altruism in their budget. Even after a tough year due to the pandemic, people are still finding ways to give back,” says Neil Robinson, CEO of Relate.

If you’re interested in including charity in your budget, there are two ways you can go about doing this:

1. Include it as one of your budget categories, the same way you would include, for example, entertainment and health. When you do your budget each month, you can then allocate a set amount towards altruism.
2. Alternatively, you can pledge any money you manage to save above your predetermined savings category. For example, if you budget R2,000 towards food but you only spend R1,900, you can donate the R100 surplus to a cause that interests you.

Either of these would allow you to dedicate some of your money towards altruism. The one you choose will depend on what suits your lifestyle best.

However, be cautious not to spend your savings on charity. The money you save each month should not be mixed with any other category, including charity.

READ MORE: Did you know there are alternatives to traditional budgeting?

What if you don’t have enough to donate?

If you’re working with a tight budget and you don’t have a substantial amount of money to donate to good causes each month, it doesn’t mean you can’t still contribute. Here are two other ways you can still support groups and communities in need:

1. Participate in a charity rewards programme

Robinson points out that if you have a tight budget, and really can't spare any of your savings, sign up for a free programme like MySchool MyVillage MyPlanet with Woolworths.

“The programme has raised over R64 million this year alone for schools, charities, animal welfare, and environmental organisations,” says Robinson.

“Every time a purchase is made at a retail partner, such as Woolworths or Bidvest, a donation will be made to the cause of your choice – at no cost to you,” he explains.

2. Purchase items that support local communities

“A creative way to give back is through gifting with a purpose. For example, Relate is a 100% not-for-profit organisation that employs people from township areas to produce bracelets,” says Robinson.

He explains that the money made from these sales go to the employees, as well as various charities which each have their own bracelet design.

There are many similar groups in South Africa that you can support. Do some research online or reach out to a local group you trust to assist you in purchasing items that will support those in need.

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