Laura Rowley Money & Happiness

Charitable giving is among the swiftest routes to aligning your money and values. You may be among the estimated 70 to 80 percent of Americans who contribute money to at least one charity. But is the cash you invest really reflecting your deepest beliefs or your highest ideals?

That's the question I found myself asking after hearing a talk by philanthropist Cecilia Boone, president of the Dallas Women's Foundation. (I spoke about money and happiness at the group's conference on charitable giving on Apr. 27.) Part of a global network of women's funds, DWF raises money to support programs serving women and girls in North Texas, funding education, job training, health care, affordable child care, and domestic-violence prevention.

"It's more than giving out of a sense of responsibility -- it's a joy to give, it's empowering," says Boone. "It really is about stewardship."

"Everyone Is a Philanthropist"

Boone, a low-key Kentucky native, was working for IBM when she was transferred to Dallas in 1972. There she met husband Garrett Boone and left Big Blue to help him start The Container Store, now a 37-unit chain with an estimated $425 million in annual sales.

"The company opened in July, and I was holding at out at IBM for my 10th-year anniversary so I'd be vested," she recalls. "Not knowing how The Container Store would work out, I figured I'd need it for my retirement."

Boone raised three children and became a leader in charitable causes. "Everyone is a philanthropist," she says. And the numbers agree: In 2004, non-governmental sources gave nearly $250 billion to charities, according to research by the Giving USA Foundation. Of that, 83.6 percent came from individuals; 11.6 percent from private foundations; and just 4.8 percent from corporations.

Studies have found men and women give differently. Women give to twice as many organizations as men do, but make smaller donations to each, according to a study by Kaye Ferguson-Patton in the book "Women as Donors, Women as Philanthropists" (Jossey-Bass, 1993). While men tend to base philanthropy on business connections or a desire for public recognition, women are driven by the desire to make a difference, often giving time to an organization before they give money.

What Kind of Giving Do You Practice?

But with an estimated 1.5 million registered charities in the U.S., effective giving can be a challenge. My mailbox is stuffed with appeals from Habitat for Humanity, the Sierra Club, the Susan G. Komen Breast Cancer Foundation, Easter Seals -- all wonderful organizations.

Their requests pile up in a stack on my desk like tickets to ride on a leisurely guilt trip. Perplexed by my choices, and overwhelmed by the due diligence required, I give haphazardly, with no overriding objective of what I want my energy and cash to accomplish.

Boone asked us to sort our giving into one of four categories: Honored obligations, social/fun giving, passionate giving, and strategic/transformative giving. Honored obligations are the groups we feel compelled to support, such as a college alma mater, or a church or synagogue. Religious entities received $88 billion -- the bulk of charitable contributions in 2004 -- while education is in second place, at $34 billion, according to Giving USA.

Social/fun giving includes the cookies you buy from the Girl Scout next door, the art museum you support that has terrific parties or exclusive family night events, or the tickets you purchase for a charitable golf outing because your boss is on the group's board.

Passionate giving, on the other hand, goes to causes that reflect your deepest beliefs or ideals. Strategic/transformative giving provides the resources for making systemic changes in society -- proactively addressing the underlying cause of an issue, rather than treating the symptoms.

A Generous, Accountable Life Rooted in Your Values

"There will always be honored obligations," Boone says. "But you want most of your giving to be passionate and strategic or transformative." She suggests putting together a mission statement for your philanthropy that briefly answers two questions: What do I want to do with my giving and my time, and why? For a how-to, check out "Inspired Philanthropy" by Tracy Gary and Melissa Kohner (Jossey-Bass, 2002).

Once you develop a mission statement, evaluate the financials of the charity you're considering. A few rules of thumb: No more than 10 percent of the organization's budget should go to fundraising and publicity, and no more than 35 percent to administrative costs. Guidestar.org and Give.org are online databases that profile hundreds of charities, link to their IRS filings, and offer some guidelines for choosing an organization.

With the 2005 tax season still fresh in the mind, this is an ideal time to revisit your giving. If you itemize your return, you have information at your fingertips listing the organizations you supported, and how much you gave. Analyze where the money went, and develop a model for where you would like it to go in the future.

Stewardship is a word most people associate with religion, but I define it as a generous, accountable way of life rooted in your deepest values. The same day I attended the philanthropy conference, construction began on the 1,776-foot Freedom Tower that will rise at the World Trade Center site. I keep a quote taped to my desk, taken from the journal of Brad Fetchet, a 24-year-old equity trader who died on the 89th floor of Tower 2. He wrote: "You can tell the character of a man by what he does for the man who can offer him nothing."

Everyone is a philanthropist. What do you want to do with your giving and your time, and why?