Just about everyone sets some sort of life goals, especially in January. From sports to weight loss to Bible study to schoolwork, we accomplish more when we focus on tangible aims. Goals can motivate us, challenge us, and inspire us.
When it comes to giving, goals can be especially powerful. Imagine the joy of planning to give away $10,000 this year and accomplishing that. Or maybe, for you, it’s $100,000. Or perhaps you hope to give $1 million away over your entire lifetime. Regardless of how many zeros you include in your numbers, there is tremendous power in setting goals, determining how you’ll meet them, and seeing the fruit of your faithfulness come to life over time.
Well-planned goals are always the most effective, and they can’t be created haphazardly or in a vacuum. Giving goals are connected to other financial goals, so the first step must include a proper examination of your personal or family financial priorities.
Financial advisor and NCF Co-Founder, Ron Blue, says, “Most Americans have a fear of not having enough money to last throughout their lifetime. This fear is one of the greatest obstacles to experiencing the joy of giving.” One way to overcome this fear is through the concept of setting a “financial finish line.” Ron explains, “I encourage people to set a finish line in terms of income and wealth. Decide the limit of your lifestyle, and then set a cap. This is important to do in advance because, as your wealth increases, so do the endless ways to spend, save, or invest it – and the finish line gets pushed further and further away.”
To determine an approach to setting goals for your giving that builds God’s kingdom, spend some time considering these three important questions:
- How much is enough?
Christian financial author and NCF Co-Founder, Larry Burkett, answered this question by setting a modest standard of living and then giving away the rest. One year before he passed away in 2003, Larry’s book sales were very significant, enabling him to give $800,000 to charity annually. Terry Parker, another of NCF’s founders, and a personal friend of Larry’s, says that “Larry knew what it meant to stop at the finish line each year. And he never lacked for anything. Determining how much is enough to live on is not so much a formula as it is a guard against excess accumulation. Although the target may change over time depending on your circumstances, the process of trying to determine how much is enough is still helpful. The key is to recognize (through seeking God’s wisdom) that an estimated amount, or range, is enough.
- How much should I give to my children and grandchildren?
Don’t forget to consider who your next steward is and whether that person is prepared for wealth. Most people give very little thought to this question. The default plan is to divide an estate equally among the heirs, pass on as much as possible at the lowest possible tax cost, and never discuss those plans with the kids before death. But this approach overlooks crucial factors that should be taken into account, such as instilling a good work ethic in your heirs, teaching them God’s principles about giving and generosity, and adequately preparing them for what to expect of their inheritance. Carefully preparing your heirs for how to handle the inheritance you leave them is much wiser than leaving them unprepared for a sudden influx of capital. (Proverbs 20:21).
- Should I give now or later?
Once you’ve determined how much is enough for you and your family, the rest of your estate is free for giving. But most people are content to hold on to as much as possible as a sort of insurance policy against misfortune and tough financial circumstances.But why wait? First, God knows what you need for your daily bread. He can be trusted to provide for you in the future, as He has in your past. Second, by giving a portion of your estate now instead of waiting until after death, you’ll experience countless benefits: you’ll demonstrate the generous life to your heirs, you’ll experience the joy that comes from obedient generosity today, and you’ll very likely reduce your tax burden – which means you’ll send far more to charity than you ever dreamed possible. To use a financial analogy, you’ll get “compounding returns” on your charitable investment, as your gifts have exponential impact as the years go on.
Once you’ve examined your heart using the three key questions above, you’re ready to set your giving goals. If you have a Giving Fund, this process of determining goals can be fast and simple. (Note that this is available only on the desktop version our website, not on mobile phones.) Just log in to your Giving Fund, click the Activity tab at the top, and then click “My goals” on the left side of your Activity page.
Once your goals are set, you’ll have a visual reminder of your progress, for the year or over the course of your lifetime. Note: Your goals are Fund-specific, so if you have more than one Giving Fund with NCF, you can set separate goals for each Fund.
Okay, now that you know how much you plan to give and grant, let’s explore some tax-smart ways to maximize those goals.