My pastor likes to tell folks how extreme I am when it comes to money management.
But, he follows up with explaining why that’s a good thing. He knows, as I do, that people won’t want to do everything I recommend but if I can get them to meet me in the middle, they’ll save more and spend less.
So here are my favorite columns from the past year. I hope they inspire you to be a little more extreme in your personal financial life. Or I hope you’ll be less judgmental for people who have made mistakes.
This column led to this debate: Debt: Smack it or hug it? My debate with Michelle Singletary.
The college graduate with a double major — and no debt
If you have a high school student trying to decide between a college that won’t require student loans — or very little — and one that would necessitate heavy borrowing, you have to read this column. Then watch this video and of my daughter and how not having the burden of education debt has impacted her future.
Kristy from Southern Indiana shared her two favorite online chats from 2017.
“Thanks for all your wisdom,” she wrote. “Thanks for having good mentors in the way of authors, who prod us to read and learn more about finances. I make note of your guest authors, and seek out those books. And Jeff Kreisler, co-author of “Dollars and Sense” was a great chat guest. Thanks for asking for and sharing testimonies. It makes me so happy when someone achieves one of those goals. Best wishes for great things to come in 2018.
Read the chat with Kreisler: Color of Money Live: Think more, spend less
And the review of the book: Your spending problem is all in your head — here’s why
Last live chat of the year is today
It’s just you and me today. Let’s talk about the financial highs and lows of 2017. Join the discussion by clicking this link.
Just in time for the holidays: Will people still give or as much if they can’t get a deduction for their charitable giving under the tax plan?
It’s done. The GOP got its tax overhaul that enriches the rich and corporations and trickles down some money to the rest of America.
As part of the plan, there’s a boost in the standard deduction may result in fewer people itemizing. And without itemizing, not as many taxpayers will be able to deduct charitable contributions. And we know that the charitable tax deduction has been a powerful incentive in getting people to give.
So last week I asked: If you can no longer itemize charitable donations on your tax return would that impact your level of generosity?
Dave Jouppi of Lindenhurst, Illinois wrote, “I will still donate to some organizations. But I will be very selective about who else I donate too and most likely will decrease amount of donations.”
Barbara Bailey of Goodyear, Ariz., wrote, “Not being able to deduct charitable donations would limit the number of organizations I would support or the amount of monetary support given or possibly both. Getting a deduction isn’t my sole reason for donating, but it would make a difference if I weren’t able to receive a tax benefit. This would impact the recipients negatively.”
“Changing the tax law and making my charitable donations no longer deductible won’t make a change in the way I donate,” wrote Rosemary Vieira of Midlothian, Va. “We have never donated to get a tax receipt. We donate to help people who aren’t as fortunate as we have been and to support causes we think are worthy. That will not change if tax laws change. The time I donate to organizations is not deductible, but that doesn’t stop me from volunteering. In fact, I always feel a little guilty taking the tax deduction, because that’s not what giving is (or should be) about.”
Sandra Wade of Chapin, S.C., wrote, “We have been caught by the AMT for years, so our deductions, mortgage and charitable, didn’t matter. This will not affect our charitable giving. And we are not wealthy, but upper middle DINKS.”
Lane R. Hatcher of San Antonio, Tex., wrote, “The charitable organizations I support are very close to my heart, and my desire to give them my money was never based on reducing my overall tax liability. Nothing about this tax bill changes that, and I might even be incentivized to give them more money in the future.”
Jordan Feirman of New York plans to still give and then some.
“I’m an upper middle class New York City resident that had long relied on the deduction for charitable donations,” Feirman wrote. “Under the current iteration of the GOP bill, I will be forced to take the standard deduction (no more AMT, but also goodbye SALT deduction). So, over the past week, I’ve inquired with several of the nonprofit organizations to which I donate each year as to whether I could make additional donations in December 2017 but have them considered as my 2018 or 2019 contributions. The idea is that I am giving precisely what I would have given each of the next two years, but front-loading it so I can get the deduction and make the donations financially viable. Happily, many of these organizations are more than willing to accommodate, and have protocol for precisely this circumstance. For example, my alma mater can separately track so-called ‘recognition years,’ so my ‘streak’ of consecutive years donating to the university will be kept alive even though I am giving a triple donation in 2017. I strongly encourage your other readers who want to keep giving donations to consider this same option. But do it quickly, because time is running out!”
David Biemesderfer, president and chief executive of United Philanthropy Forum wrote, “Here at United Philanthropy Forum we agree with you that most people will continue to give even if they are no longer able to claim their charitable deductions, but all the studies we have seen confirm that people will give less. In addition to the Indiana University study that you cite, a new study by the Tax Policy Center estimated that charitable giving would drop by as much as $20 billion next year because of the tax bill’s effective elimination of the charitable incentive for donating to nonprofits. The charitable deduction has been around for 100 years, and there is solid evidence that it is an effective incentive for charitable giving. There’s a reason why the bulk of people’s donations come at the end of the year – the deadline for counting a donation on their tax returns.”
Color of Money columns this week
Knowledge isn’t power. The right knowledge is power.
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Have a question about your finances? Michelle Singletary has a weekly live chat every Thursday at noon where she discusses financial dilemmas with readers. You can also write to Michelle directly by sending an email to firstname.lastname@example.org. Personal responses may not be possible, and comments or questions may be used in a future column, with the writer’s name, unless otherwise requested. To read more Color of Money columns, go here.