Guys, a lot of us make money on trading and sometimes there's an excess that you don't need. Do you think it's a good idea to donate part of the profits to charity? Whom would you suggest helping first?
If you are financially able to support a charitable cause, by all means you should do it.
There are many charities that are very worthy causes. I've worked with non-profits and charities for the past 12 years, so I can give you a few pointers. There's really no bad way to support something you believe in, but from experience here's my suggestions:
Some people like giving to charities that are large and well-known. Some of these are very well-deserving. If you're in the United States, or looking to support a U.S. based charity, you can see ratings of all the large charities on this website, Charity Navigator:
https://www.charitynavigator.org/One thing that many people find important when considering charitable giving is the amount of your contribution that goes towards the cause. For example, if you donate $100 to feeding the poor, how much of your money actually goes to those in need and how much of the money is used by the charity to cover their costs of overhead and operations. There's no perfect way to figure out what is the optimal number. Ideally, all of your money would go toward feeding the poor directly, but in reality, the charities need to pay for staff, office space, electricity, and other costs, so it's likely that some percentage of the funds they bring in goes towards these costs. Usually, a good benchmark is under 20% overhead / 80% toward the direct "program services". Some charities can do much better than this ratio, it really depends on what their charitable purpose is and how large of an operation they are. Larger operations often can save costs overall because they can essentially "buy in bulk", so sometimes they can do a ratio of 90% / 10% or even better.
If you're looking to support a charity that's local to you, this website lists all charities in the U.S., large and small:
https://www.guidestar.org/Home.aspx Sometimes supporting a charity that is closer to you is preferred by people, I can understand that. GuideStar lists all U.S. qualified charities. They'll be listed on their site as a "public charity" as opposed to a "private foundation". Private foundations are generally large funds that are set up by philanthropists (an example is the Bill and Melinda Gates Foundation) for purposes of giving money to charitable purposes. They generally do not raise money from the general public.
One thing to make sure of is that you're legitimately donating to a charity. Just like anywhere else, there are scams that set up fake websites and fake fundraising campaigns. Make sure that you don't fall victim to one of these scams.
Another thing to be careful about is crowdfunding websites, like GoFundMe. Though there are legitimate charitable causes on there, there are also many fakes, so make sure you're dealing with a real charity before you donate.
In the United States, if you donate to charity, you can claim a tax deduction for the amount of your donation, subject to certain limits. I'm not an accountant so you should consult one if you plan on making large donations. One special thing to note as it relates to cryptocurrency: Donations of cryptocurrency can, if donated in the right way, significantly lower capital gains taxes, which can reduce your income tax liability substantially. There are crypto-savvy accountants that can help you with that, it is similar to if you donate stock. Essentially, donating an asset to charity allows you to claim a deduction for the full market value of the asset. If you first converted it to dollars and then donated those dollars, you would be subject to capital gains taxes on any gain on the value of the crypto/stock/etc., so you can see how, if you are able to work with a charity to donate in crypto, you can significantly reduce your taxes by offsetting capital gains with charitable contributions. Again, talk to a tax professional, I am not one, etc.
Another way you can support charities is by donating things that you no longer need, such as an old computer, or old clothing or other things that are still useful but that you don't have a use for any longer. If possible, try to give something that is at least functional. Some charities will accept things that aren't functional, like a broken computer, but if it's the case, try to make sure they're able to accomodate that. Some charities really are small and unable to store and/or have repaired something that they can't use. Also, some are so small that they literally have nowhere to put donated goods, so in those cases, money is probably best.
Outside of the United States, most countries do have a government registry of charities, so it is always a good idea to make sure the organization you're supporting is listed. I do not know all of the rules on every country, but many countries allow you to claim some tax benefit for supporting a cause. A good place to look for such a list would be on the government websites for your country.
In any event, supporting something that you care about is a great thing to do! One last thing to always keep in mind: charities also often need volunteers to give their time to help them accomplish their mission. If you have time to spare, consider volunteering!
Good luck with your crypto trading. I hope you all make lots of money, so much that you're all able to donate some to good causes that you support!
Best regards,
Ben
