If you’re on a wealth-building journey, you probably focus on how to reduce your debts and increase your investments. While this is commendable, it’s wise to look ahead and consider what you will do when you’re out of debt and earn plenty of money every month.
After taking care of your own welfare, think of the good you can do for humanity.
Pause to reflect on the wisdom of Andrew Carnegie, one of the richest Americans in history. The American steel industry tycoon who amassed a fortune in the late 19th century said, “Surplus wealth is a sacred trust to be managed for the good of others.”
A Common Myth About Wealth Building
Many people assume that the ticket to wealth is hoarding every penny. This misconception arose because there are many stories of wealthy people having stingy ways.
Some of these stories are fabrications, others misinterpretations of events. For example, the press often excoriated John Rockefeller for his stingy behavior. But this may have been a mischaracterization. Rockefeller didn’t talk to reporters about his donations because his strict Baptist upbringing viewed modesty as a virtue. In fact, by 1912, he had donated hundreds of millions to charities. In today’s money, this would amount to billions.
Frugality vs. Stinginess
It’s important to distinguish between frugality and stinginess.
Frugality is about maximizing the value of money while a stingy person is someone with money who hates to spend any of it. Frugal people aim to be good stewards of money and not squander it.
Stinginess, on the other hand, is fear-based, scarcity thinking. It’s a fear of running out of money.
Choose a Charity
The easiest way to learn how to give is to find a charity that will benefit from your largesse. There are thousands of charities out there, so be sure to give to one that reflects your values.
The best way to choose a charity is to get clear on your values, identify causes you prefer, and then donate to charities that meet your criteria. If, for instance, you feel strongly about supporting children in foster care, then find a foster care agency in your state. If, say, you live in California, then consider what ways you can help adoption in California.
Besides giving from your current abundance, you can also give away future wealth. One way to do this is to name a charity as a beneficiary of your life insurance policy.
Why Generous People Prosper
Although there are mystical interpretations of how you receive more of what you give, one practical reason generous people prosper is that giving improves their relationships and relationships attract financial opportunities.
Still, generosity isn’t just about giving money. Generous people also share their time, knowledge, and experience to help others. Generosity is a positive character trait that attracts goodwill and friendship.
When you give of yourself and your money, you make the world a better place. This friendly attitude to life is contagious. People want to be around you because you are a warm and caring person.
The receiver isn’t the only person who benefits from giving; giving also changes the character of the giver.
When you give, you unleash good things in the world.
When you give, you lift people up out of difficult circumstances.
When you donate a significant sum of money to a charity, you help more people than you will ever know.
Giving also lifts you up and puts you in a positive frame of mind. It refreshes your belief in humanity. It gives you pleasure to see how other people benefit because of your contribution. When you give, you take your attention away from your own pressing problems and improve humanity.
So, when you finally reach a point when you’ve paid off your debts and surplus income rolls in, don’t simply tuck it all away into your 401(k) and your other investments. Do yourself and the world a favor and think about ways to make life wonderful for other people, too.