Think of your giving as an investment, not a purchase

Posted on

When you purchase an item from a store, you know exactly what you are getting. If something doesn’t meet your expectations, you can return it and get a refund.

This is a different kind of transaction than an investment. When you invest in something, there are no “refunds.” You can’t get your money back if things don’t go as expected. You are stuck with your decision, good or bad.

Investing serves as a nearly perfect metaphor for giving. When you give, you are hoping that good will come from it in the future. But you must also be aware of the risks associated with your transaction. Maybe good won’t come from it. Maybe bad will happen instead!

For example, you might give money to an orphanage in the hopes that you will provide a warm meal for a disadvantaged child. But, instead, you might accidentally end up financing the salary of an abusive orphanage director. This would be considered a bad investment.

This example is precisely why you need to think of your giving as an investment and not a purchase. You can’t turn around a bad investment because it’s already happened. But that doesn’t mean you stop investing! What it actually means is you should learn from your mistake and invest better next time.

Here are some rules for investing that can also be applied to giving:

  1. There is no such thing as a “fool proof” investment. All investments require some amount of risk-tolerance and trust. Accept it.
  2. You should invest in people or organizations that you can reasonably trust.
  3. You have a finite amount of resources, so you are only required to do the best with what you have.
  4. If you’re a good investor, you should expect to have some investments go south.

I know that some will be quick to point out: shouldn’t we avoid “bad giving” at all costs because we’re talking about human beings and not money? It’s a fair question, but one with an easy answer. If you are nervous that your giving might turn out bad, you also have to factor in the risks of “not giving.”

At the end of the day, what’s worse? Having a well intentioned donation go south, or refusing to help someone in need because of the potential that it might go south? The answer may vary, but the point is made. Action and inaction are both risky. It’s unavoidable. You must do the best you can with the resources you have. Just like investing.