Quoting Wei Dai <[EMAIL PROTECTED]>: > Suppose I have some money that I don't want to spend, and I'm sure I'll > never want to spend it. Should I give it to charity now, or put it in an > index fund and bequeath it to charity in my will? > > Here's my argument in favor of charitable procrastination. The typical > recipient of charity does not have access to the kind of investment > opportunites (e.g., low cost U.S. mutual funds) that I have, and his other > investment opportunities usually have a lower (perhaps even negative) rate > of return. Charitable organizations are legally forced to spend a certain > percentage of their assets per year, so they can't invest the money > indefinitely either. By holding on to my money, I'm actually increasing > the present value of the gift from the perspective of the recipient. > > Can anyone find a flaw in this argument?
Besides the obvious one about present needs going unfullfilled, there is this: Small charities may not have access to the investment options you do, this is true. But they do grow oranizationally, and withholding small but signifigant present contributions in favor of larger but later contributions can retard that growth potential. An example of this would be the use of a moderate-sized donation to buy advertising for volunteers or to plow back into a fundraising event, procurement of phone service or website, or some other signifigant organizational step. In the most extreme scenario, if all donors invested their future donations and withheld current donations, the organization would starve for lack of current funds and would not be in existance to *recieve* the more generous future gifts. Speaking as the director of a very small but very active charity, I can tell you that we tend to have *quite high* time preferences. Possibly some of that is bleedover from the personality of the founder (that would be gotta-have-it- now me:) but I honestly believe that for most small groups working in conditions where the need is always in far excess of resources available, this time preference exists. The situation with respect to large charitable organizations may differ signifigantly for several reasons, but I don't feel as qualified to discuss that. So go buy some raffle tickets now as my signature 'asks' ;-) -- Susan Hogarth Buy some raffle tickets or else! http://www.tribeagles.org/raffle/
