In households across Australia, the bins are overflowing, the freezers are full of prawn heads, the kids are merry but manic and the adults are broke and bloated.
And it’s technically only the third of the 12 days of Christmas. I don’t know about you but we’ll keep our festive fir tree up until January 6.
Before we dive into the prolonged festival of consumerism that is the summer sales or turn our thoughts to the new year, let’s pause to reflect on the season of giving.
December is the third-biggest month for charitable giving behind May and June, the two months before the end of the financial year when people are trying to maximise their tax deductions, according to Commonwealth Bank figures.
The lead-up to Christmas is when many charities give a big marketing push to drum up donations. It’s also a time of greater need, especially for organisations that help disadvantaged families in Australia or rescue abandoned pets, for example. But no matter the cause, the need doesn’t disappear in January.
The good news is that Aussies are generous year-round. CommBank’s two million customers donate to causes an average seven times a year, with some people making as many as 26 donations in 2017.
Two out of three Australians donate to charity, according to a survey of 2017 people by comparison site Finder. That puts Australia in the top 10 globally for the proportion of the population that participates in giving to charity, according to the World Giving Index.
Finder’s survey suggests Australians will give $4.2 billion to charity in 2018. Both Finder and CommBank came to the same figure for the average annual donation per person – about $300.
Women are more likely to give, but men make bigger donations. And despite their large mortgages and the cost of bringing up kids, members of Generation X donate more than any other generation – an average of $400 each.
So what are the most effective ways to give?
Charities value having regular, predictable income. It keeps their marketing costs low and ensures they can plan and deliver the most effective programs.
However, it’s far better to go direct than to sign up based on an interaction with a face-to-face fundraiser – whether a doorknocker or a so-called “chugger” (charity mugger).
Face-to-face fundraising has a role to play since many people are slack and wouldn’t otherwise give, but if you’re motivated enough to make a direct pledge then you’d be doing the charity a favour.
That’s because the fees charged by face-to-face fundraisers can be significant, equivalent to 19-25 per cent of the donor’s gift over a typical period of three to five years, according to the Fundraising Institute Australia. It’s not a simple skim off the top of a particular donation but part of the annual marketing budget set by the organisation.
So researching a few organisations worthy of sustained support and then pledging a regular donation is a great way to go. It also makes tax time easier as most’ll send you an annual statement.
Or you can ask your workplace if they offer payroll giving, then you get the tax advantage with every pay packet rather than waiting until you make a claim the following financial year.
How to choose? First, consider what causes you care about. If you want a little more detail, check out the annual report on the organisation’s website to find out how the money is spent.
For the mathematically minded, have a look online to read about a movement called “effective altruism”, which is about ensuring your charity dollars have the maximum benefit. For the rest of us, I’d say don’t let the perfect be the enemy of the good – better to pick a charity and start giving, then change course later, than not to give at all.
You can also give in kind. Rather than putting unwanted gifts in the cupboard to regift later or sell on Gumtree, how about donating them to a charity shop?
But don’t go and buy items specifically to give to charity. Cash is better.
For example, a food bank will happily work with individuals who want to organise a food drive but before you go to all that time and effort, you should know they can buy food at discounted and bulk prices so cash donations will almost certainly go further.
Many economists have a low opinion of gift giving because the amount one person spends on a gift is typically more than the amount the recipient values it, with the gap creating a “deadweight loss”. In a 2009 book called Scroogenomics, Joel Waldfogel, now a professor at the University of Minnesota, estimated that the deadweight cost of under-appreciated Christmas gifts was $US12 billion in 2009 in the US alone.
At least with gift giving, there’s a social bond created between giver and recipient. A carefully chosen gift can be more meaningful than cold, hard cash because, after all, it’s the thought that counts. That doesn’t really hold when you’re donating a can of baked beans to a food bank.
As John Lennon sang, so this is Christmas and what have you done? Hopefully, you’ve helped a little, but I reckon we can do even better in 2018.
Caitlin Fitzsimmons is the Money editor and a Fairfax columnist, writing about money, work and life. Facebook: @caitlinfitzsimmons
This story Administrator ready to work first appeared on Nanjing Night Net.