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Best practices for living a healthy financial life: Giving back

By WTOP Staff

Barry Glassman

WTOP Finance Contributor

WASHINGTON — As you do your holiday shopping in the next few weeks, you’ll hear a familiar
ringing sound. For many, the Salvation Army’s bell is a reminder to give to others in need, especially
during the holidays. For me, the bell’s iconic toll makes me reflect on the impact I have had on the
causes I care about most.

In working with clients over the years, I have found that those who give their time and treasure to a
cause they care deeply about are more fulfilled. Perhaps it’s because the simple act of helping others
amplifies a greater purpose in all of us.

There are many deserving organizations doing great things, but before I go into the details of finding
great charities to which you can donate, I want to spend some time on the trend of targeting your
donation dollars.

Should You Target Your Donation Dollars?

We have more control over how our ‘charity of choice’ uses our donation. For example, it’s become
very popular to stipulate that your dollars go toward the charity’s programs rather than overhead and
marketing. After all, most would rather feed more people or pay for more cancer research than support
the staff’s salaries.

But overhead isn’t always a bad thing to support. Dan Pallotta, an activist and fundraiser, says the way
we think about charity is undermining what we want to accomplish. In his 2013 TED Talk, “The Way We Think About Charity is Dead Wrong,” Pallotta points out that charitable
organizations simply can’t compete against the private sector for top talent because they’re not able to
offer competitive salaries to attract and retain them.

They are often penalized for having large marketing budgets, even when these efforts result in even
greater giving. He believes that we have to start rewarding charitable organizations for their big goals
and big accomplishments if we want to see big changes in our world’s most daunting issues.

I’ve been involved with The National Brain Tumor Society
(NBTS) for over 20 years. When someone
receives the devastating news that they have a brain tumor, his world is turned upside down. When a
patient contacts NBTS, he is connected with a counselor who understands the fear, anger and confusion
the patient is going through.

These amazing people are there to help each patient sort through his emotions, understand his
treatment options and provide support for the patient and his family every step of the way. The salaries
and other expenses for the counselors fall under NBTS’s administration costs, but I think we all agree
that the counselors have an enormous impact on those the organization serves.

The moral here is that while we all want charities to use our money wisely, perhaps we should place
more emphasis on the outcomes they are having rather than on the amount of their overhead.

Choose a Charity that Aligns with Your Values

We all have reasons that we give, and if you have a deeper connection to a cause, chances are that you
will have a greater impact. If you’re not sure about how to find reputable charities or you want to
research a charity before giving to them, a great place to start is CharityNavigator.org.

This is a fantastic one-stop resource to learn more about all types of 501(c) (3) charities. The website
scores charitable organizations and awards stars based on their financial health and transparency and
accountability, as compared to others with similar causes.

The site provides information about the charity’s mission and financial statements, and suggests other
highly-rated charities doing similar work. You can also compare several charities before making your
decision.

Give local:

If you want to make a difference in your community, consider giving to your community foundation.
These organizations know the local charities and the critical needs in your community. Many community
foundations fund several charitable initiatives each year with programs that serve children, veterans, the
homeless and the aging in their communities.

Donations can be earmarked for specific charities that the community foundation supports.

Community foundations also initiate Giving Circles, such as the Business Women’s Giving Circle,
established by the Community Foundation for Northern Virginia. The mission of the women who
belong to this giving circle is to empower women and girls of all ages to innovate, lead and succeed.

Giving Circles are also a great way to connect with others who share your passion on a more personal
level. To find a community foundation near you, use this Community Foundation
Locator.

Consider Crowdsourcing

At a recent conference, I learned first-hand about the enormous impact that crowdsourcing can have
when someone takes a problem and invites the world to help solve it.

Here’s one example: Charles Best was a teacher who decided to take a lunch-time conversation with his
fellow teachers about all the books and supplies they needed and put those requests on the internet.
Since founding DonorsChoose.org in 2000, the impact
the organization has had on teachers, students
and schools is nothing short of astounding.

It has raised more than $285 million and funded more than 520,000 projects affecting 13 million
students in 60,000 schools. This short video explains why Oprah Winfrey and Michelle Obama support
the efforts of DonorsChoose.org.

—

Giving back has been a big part of my life since I was in high school, so this is a good way to wrap up
my “Best practices for living a healthy financial life” series. Whether you choose to have an immediate
effect on an issue — such as funding a class field trip, donating to long-term challenges like finding a
cure for cancer, or volunteering at your local food bank — you and your family will change lives for the
better.

If you missed the other segments, I encourage you to read the “Best practices for a
healthy financial life” articles:

  1. Getting started
  2. Creating your personal financial plan
  3. Sharing your risk
  4. Be a good financial role model

    Editor’s Note: Barry Glassman, CFP®, founder and president of Glassman Wealth Services in McLean,
    Va.,
    is a
    nationally recognized leader in investment and wealth management. His fee-only
    firm offers successful professionals, executives and business owners financial
    guidance and resources to effectively manage their family’s wealth. Follow
    Barry
    on Twitter at @BarryGlassman.

    Follow @WTOP and @WTOPliving on Twitter.

Don’t Settle for Student Loans to Pay for Online Education

By WTOP Staff
Online college programs are becoming a more popular choice for prospective students, with one study finding that more than 6 million students enrolled in at least one online course in fall 2015. The popularity of these courses can be attributed in part to their flexibility with working adults' schedules, students' ability to progress more quickly through online programs and, oftentimes, cheaper tuition. [See 10 low-cost online bachelor's programs for out-of-state students.]Online degrees can be beneficial to many college students, but some studies have shown online learners complete their programs at lower rates than students at traditional brick-and-mortar campuses. Individuals with student loans but no degree comprise two-thirds of defaulted borrowers. Though these numbers are not encouraging, just like for traditional programs, there are ways to reduce how much you'll need to borrow for an online program to ensure you won't become one of these statistics. Don't just settle on borrowing student loans to cover the whole cost of your program and living expenses. Instead, start thinking about how to cut costs and cover your balance in different ways, such as the following. -- Grants and scholarships: Even though you are taking an online course, you can still apply and receive grants and scholarships. But your first step should be to complete the Free Application for Federal Student Aid, commonly referred to as the FAFSA, which will allow you to receive a Pell Grant if your expected family contribution is low enough. The EFC criteria and award amounts are adjusted annually, but the 2017-2018 academic year awards range from $606 to $5,920, which could significantly lower the amount you borrow annually. Your next step is to apply for scholarships. You can start by checking online scholarship search engines, such as the Salt Scholarship Search, College Board's BigFuture and Peterson's. But don't forget to take advantage of local organizations and your school's financial aid office. Both may offer scholarships that you can't find with a national scholarship search. [Review these 10 sites to kick off your scholarship search.]For instance, organizations like the Elks Club, Knights of Columbus or the Rotary Club typically offer scholarships annually to local students. Just because you're going to school online doesn't mean you're ineligible. Visit your local library for scholarship listings, and ask around town. You might be surprised how many local organizations offer scholarships. While these scholarships typically aren't large, every little bit counts. Each dollar you receive in a scholarship is a dollar you don't have to borrow and pay interest on. -- Work-study: Another option for online students may be work-study awards. Not all students enrolled in online programs are eligible, but students at some schools -- including, for example, SUNY Empire State College and Liberty University -- are. Work-study awards are not given upfront like scholarships and grants. In most cases, they are an offer to earn up to the awarded amount if you secure an eligible work-study job. While there is a misconception that all work-study jobs must be on campus, students can work for off-campus, nonprofit or public employers as long as the work is in the public's interest. You may be able to work for a for-profit employer if the job is relevant to your course of study. No matter who the outside employer is, it will need to have an established agreement with your college for you to receive work-study funds. Remember, to be eligible for federal financial aid, you must be enrolled and pursuing a degree or certificate. If you're not working toward a credential, Pell Grants and work-study won't be option, but you may still be able to take advantage of private scholarships -- just be sure to read the eligibility criteria carefully. [Explore what to know about financial aid in online programs.]-- Pay as you go: One of the great benefits to enrolling online is the flexible schedule, which can allow you to complete your college coursework around your responsibilities. But prospective students often overlook using their part- or full-time job earnings as an option for paying for college. Almost 80 percent of college students in 2015 worked at least part time while attending classes, according to the National Center for Education Statistics. By budgeting and thinking strategically about your college costs, you can likely reduce your dependence on student loans by paying a portion out of pocket. Many -- but not all -- online programs are less expensive than traditional programs and often have shorter payment periods. Six, eight or 10 weeks are common course durations. Because of the frequency of payments in an online setting, you may be well-placed to pay as you go and possibly avoid borrowing altogether. Attending college online and avoiding student loans may be challenging, but if you are willing to put in the effort, you can limit the amount you need to borrow. More from U.S. News Q&A: Understanding Student Loan Discharge Eligibility Student Loan Refinancing Isn't Right for All Borrowers
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