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  • Writer's pictureBridget Sullivan Mermel CFP(R) CPA

Donating: Feel Less Regret, More Happiness!

Giving money away can come with happiness or regret. Bridget Sullivan Mermel and John Scherer discuss how to avoid three flavors of donation regret. Stay tuned for our tips on how to feel more of the warm glow of giving, too!

John uses his own stories to illustrate how donating can make you feel bad or good. He talks about how he thinks about being scammed by a charity and what he learned from the experience.

We talk about public radio station changing formats, and feeling like you can't do enough to solve the world's problems.

Then we pivot to talk through John's company's giving program to celebrate, plus other tips on how to feel even better about donating.

Here's the web address to check charitable organizations:

John's firm website:

For advisors around the US:

Thanks for watching and please subscribe!


Bridget: Donating money can make you happier and can give you a sense of meaning or sense of “I did something that was useful”. We want more of those feelings in our life and so sometimes we donate money but then we have some bad feelings of regret, etc. On this episode of Friends Talk Financial Planning, we're going to talk about how to have more good feelings and fewer bad feelings when donating. Hi, I'm Bridget Sullivan Mermel, and I've got a fee-only financial planning practice in Chicago, Illinois.

John: And I'm John Scherer, and I have a fee-only financial planning practice in Middleton, Wisconsin. And before we dig into our advice on giving, I want to remind everybody to hit that subscribe button. That helps other people find us on YouTube, so please hit subscribe. And I'm really interested in talking about this topic, Bridget. As you know, giving is one of my values and you brought up some really interesting things as we're talking before we hit record about some of the potential downsides to giving and how to mitigate those. So I'm really excited to dig in here and talk about that.

Bridget: Yeah. Some of the research I've looked at bears out that some people end up with mixed feelings about giving, and I think it's one of the reasons why people donate less than maybe they think they should. And so, I know that you're more of an expert on this than I am, so let's talk it through. I think one of the things that happens is people find out about charity scams.

For example, you thought you were donating money to charity but then it turns out that the person took the money and ran instead. And so that can make you feel hesitant to donate again. That's just out there. And even if it doesn't happen to you personally, I think it can sour people on the idea of giving because they wonder what the true motives of the organization are. What say you? What are your thoughts on that?

John: Yeah, I don't think in that direction very often. And so, as I was internalizing some of that discussion about scams, one of the things that's really meaningful for me and maybe is useful for viewers is when I do donate time or money, it's almost always to causes that have been around for a while and that I have some experience with. So one of the things I think can play a part in that is when you get those things in the mail and the phone calls, and it's the police or the firemen or these things, you go, “Golly, it sounds like a good thing to do.”

But if I don't have personal experience with it (and maybe it's for those reasons I never really thought about it that way before) I don’t give, because I give to the places that I've sort of done some homework on. So maybe one thing is not having it be reactive, but instead saying, “I like what the United Way does, I like what my church does, I like what these organizations do, so I'm going to support them.” Although as you're describing this, I'll tell you, it just reminded me that I rented space in our office suite to a person who was running a nonprofit, I'll say in air quotes.

And there were a lot of red flags, but I was younger at the time. He was the nicest guy. He could sell ice to Eskimos, sort of a personality. And I participated in one of the fundraisers, and I didn’t give a ton of money, but I gave some and found out later that he wasn't even a 501(c)(3) charity. He was just some guy that said he was a charity and maybe he did some good things, or not, but it was an organization, it had a name, etc. And later I find out he wasn't paying his employee and doing all these other things that went down with it. So maybe I blocked those bad things out, but I've had bad experiences.

And if I had paid attention to some of those red flags as opposed to saying, “Hey, this is a nice guy who wants me to support this cause,” maybe I would have avoided that. So maybe that's some of that personal experience speaking. Hey, if it's been around, like the United Way or the Humane Society or some of these places have been around, you have at least less chance of being scammed. It’s not like you’ll never have to worry about that, but there’s much less chance of it being some fly by night operation.

Bridget: Yeah, so I think that's a really interesting experience, especially given the ironic stance of you donating money to him and then he pays you back in rent😊

John: Right.

Bridget: Aside from that, another thing I would like to distill is if they come to you versus if you go to them. Something that you might see on TV or something you might hear from an unsolicited phone call; you're saying you give less credibility or are less likely to donate to them. Maybe you would donate if you did some outside research. I would suggest Charity Navigator to check the credibility of a charity. Is it a 501(c)(3)? Do they file the tax returns and how much do they actually donate?

John: There’s another thing that's interesting as you bring that up. And that's exactly right. For me, it's just by nature, but it's things I've got experience with. For example, I'm reaching out, and I want to support as opposed to the other way around. A corollary is things that are more local as opposed to national and the big organizations. It tends to be more meaningful for me because I know that that money is going into this community or that area.

But then maybe there's a little bit less chance anyway for chicanery to go on because you can see everything firsthand. Again, I had a bad experience with a staff of two or three people, but generally there're fewer places to hide than these bigger organizations, national things. So that’s just another corollary. The local things can be more meaningful and perhaps less fraught with potential scams.

Bridget: You might get more feedback.

John: Yeah.

Bridget: You might find out that this guy is a scammer before giving him even more money.

John: Right.

Bridget: Okay. So here's another feeling of regret that I'm familiar with: “I don't donate enough. I should do more? I didn't do it correctly. I should have done something differently.” So I'll donate money and then I'll think, “Oh, this was just a teaspoon in the ocean of problems.”

John: And what’s interesting for me, is if you don't donate at all, you don't necessarily have those feelings, but if you do, then you potentially have a feeling of inadequateness. I have not experienced that, and I haven't heard from clients having that experience with things, but I wonder can you relate that to anything? Is it tied to something else?

Bridget: Sure, I can end up feeling like that about many things, but I think one thing that I've realized as I've just processed this that I have this feeling that even the richest people in the world, who have the most money possible, can't solve all the problems. They can't donate to all the world's problems. They can make some influence, presumably more than mine, but it's like I'm holding myself to a standard that is unreachable. I think there's a different way of framing it for me that would help me with those feelings.

John: Yeah, maybe just putting it in a do-what-you-can framework. I don't have that same experience, but doing something is better than doing nothing. I'd like to go out and run 5 miles when I work out, but I can't do that, or I don't do that. If I take a walk, however, that's better than sitting on the couch eating potato chips.

Bridget: Right.

John: It's levels of thing and maybe it's an internal thing.

Bridget: Yeah. Another hurdle is thinking, and I've heard this from other people, “I don't want to donate to the public radio because every time I donate, they change the format, or the PBS station cancels my show or they're not doing what I want them to do.” Now, there're many varieties of saying, “I donated to this charity, and now they started not acting like I want them to act.”

John: Yeah, as I hear you say that it reminds me of giving to family or other people, too. If there's an agenda to it, which is natural, that can lead to frustration. For example, I give this amount of money. I want to continue to get the thing that I was getting the program, from NPR, or whatever it is. But if you can take away those contingencies or the strings, so to speak, it can make things easier.

If I'm going to give this gift to my son or daughter or grandchild, and I'd like them to use it for this, but if I tie that to an outcome that's potentially setting me up for negative feelings. If I give money to Special Olympics or public radio or wherever I give it to and go listen if they start to go in a different direction for me, then what I would do is say, “I might not give you any more money,” but I don't necessarily feel bad about what I have given you, if I can tie it to supporting the cause at the time.

For me, it's maybe a moment in time feeling more so than now. And you didn't say this, but the idea of, saying, “Now you owe me,” a quid pro quo sort of thing (I did this for you, now you should do this for me) can cause negative feelings. To the extent that we can keep ourselves separate from that and say, “You know what? I'm giving this because I think it's good, and if it changes, that's okay. It's not a lifetime commitment.”

Bridget: Honestly, for me, it's more of a feeling of investment. It's like saying, “I'm invested in you,” not, “I gave you money at one point.” I feel like it's more like I put money in, now returns need to be the things that I like about your organization.

John: To take it off on a little bit of a tangent, we see that sometimes with investments. We make an investment in a mutual fund or a company and then it goes south. People will sometimes say, “I wouldn't buy it again if I had it now, but I'm going to hang on to that because I want to ride it back up sort of thing.” Getting tied to an investment is not always best. We see it all the time with investments and maybe to the extent that you can get some distance from that to say, “Yeah, I got those feelings, but what happened yesterday and what will happen tomorrow aren't necessarily correlated.”

Bridget: So we've talked about three flavors of regret, but let's talk about some of the ways that you can multiply your happiness and sense of meaning with donations.

John: I like this better.

Bridget: Yeah. The first one I want to talk about is donating to celebrate. And John won’t brag about this, so I'm going to do some bragging for him. His firm has had its 20th anniversary recently. Yay, go John! And so, they decided to have a donating program. Do you want to talk about it?

John: Sure. What we did was we asked our clients to nominate charities and we gave out $21,000 donations on behalf of the company and our clients. And it was kind of scary because that's a big number for us. So stretching a little bit from what I felt comfortable with giving was really a cool thing. And I'll tell you the other thing that was really useful about that from a celebration standpoint was learning about some of the things that were important to our clients.

From a business standpoint, that's one thing, but I think the same thing can translate into families to find out what your kids and what your grandkids and other people who are important to you value. To be participating in that process was a really meaningful thing for us. And hopefully we did some good in the community as well.

Bridget: Yeah. And I think another part of this, again, to optimize your happiness, is that you don't get ten times the feeling of, they call it, warm glow for ten times the donation but giving 20 donations over the course of a year will make you feel good 20 times.

John: Yeah. Right. Endorphins or whatever.

Bridget: And so, it seems like that was a really smart way to do it.

John: Yeah. That's interesting. We often talk from a simplicity standpoint with clients about making larger one-time donations, but maybe we'll need to rethink that to giving a little bit on a weekly/monthly basis. There’s certainly something good there and maybe it outweighs some of the simplicity.

Bridget: Right. And sharing it also, I think is important. So sharing it with your clients makes everybody feel good. You donated the money, and I feel good.

John: That's a win-win situation.

Bridget: Exactly. Another thing that I'm working with right now is donating money as a personal reward. One of the ways that you can spend money for more meaning (there aren't that many ways) is by rewarding yourself, especially for boring, repetitive tasks that you don't really like. We all have chores, or things that fall into that category. And so, if you set up a reward that makes the whole thing feel better, and it's a good way to spend. And so, I'm thinking about using donating for a multiplying effect because already rewarding myself is going to feel good. But instead of just spending it on me, if I spend it as a reward, I think that'll help.

John: Yeah, that sounds awesome. I love that.

Bridget: Okay, great. With that, I think it's a great time to wrap it up. I'm Bridget Sullivan. Mermel. I've got a fee-only financial planning practice in Chicago, Illinois.

John: And I'm John Scherer. I've got a fee-only financial planning practice in Middleton, Wisconsin. Both Bridget and I are taking on new clients at our firms. But if you are looking for an advisor who thinks like us in your area, we're both members of the Alliance of Comprehensive of Planners, and you can check out

Bridget: And please subscribe.

At Sullivan Mermel, Inc., we are fee-only financial planners located in Chicago, Illinois serving clients in Chicago and throughout the nation. We meet both in-person in our Chicago office and virtually through video conferencing and secure file transfer.

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