To avoid guilt, divide spending into three buckets: 1) yourself, 2) causes you're passionate about, and 3) high-impact, evidence-based charities. This approach encourages adding effective giving without demanding the sacrifice of personal or local donations, making the practice more sustainable.
Related Insights
The key insight in effective giving is not just comparing charities, but recognizing that most individuals can dramatically increase their positive impact by redirecting donations to highly effective opportunities they are likely unaware of, achieving up to 100 times more good with their money.
To avoid performative activism and burnout, focus your public voice on the issues you are deeply passionate about. The key question is not what you *should* care about, but what breaks your heart so deeply that silence feels more costly than speaking up. This ensures authenticity and sustainability.
To combat the 'virus' of wealth hoarding, Professor Scott Galloway intentionally keeps his net worth flat. He implements this by matching his substantial annual personal spending—on homes, travel, and experiences—with an equal amount in charitable donations, viewing money as something to be 'rented' and deployed, not accumulated.
Reaching a 100x increase in charitable impact isn't from a single change but from combining principles that each act as a multiplier. For instance, shifting focus to a more neglected problem (10x) and choosing a leveraged policy solution (10x) can result in a 100x total improvement.
Your personal donations are just one part of your potential impact. By talking about your giving and inspiring just one other person to match your commitment, you can effectively double your philanthropic output. This interpersonal multiplier is a powerful and often overlooked form of leverage in doing good.
A study found that when people first pledge an amount and later decide on the specific charity, they give more money and allocate it more effectively. Decoupling these two decisions reduces cognitive load, allowing for more rational consideration of impact when choosing a recipient.
Avoid being preachy when discussing effective giving. Instead of telling people what to do, share your own journey and what motivates you. Then, genuinely ask for their thoughts and what they care about. This approach fosters an open conversation and strengthens relationships, making it more effective than a direct pitch.
Committing to a lifetime pledge can seem daunting. A better mental model is to treat it like marriage: a very serious commitment not entered into lightly, but one that can be exited if fundamental circumstances change. This "de-pledge" option makes the initial commitment more approachable.
Frame philanthropic efforts not just by direct impact but as a "real-world MBA." Prioritize projects where, even if they fail, you acquire valuable skills and relationships. This heuristic, borrowed from for-profit investing, ensures a personal return on investment and sustained engagement regardless of the outcome.
A charity like Make-A-Wish can demonstrably create value, even exceeding its costs in healthcare savings. However, the same donation could save multiple lives elsewhere, illustrating the stark opportunity costs in charitable giving. Effective philanthropy requires comparing good options, not just identifying them.