Donating while in temporary debt (i.e. as a student)

Holden's analysis seems sensible. To it I would add only two points:

1) Ratchet up your giving each time you get a higher income - at the time the new money is coming in, and before you start thinking about how to spend it. After you get a raise, especially an unexpected raise, is the best time to donate - rather than waiting to think about it at the end of the year.

2) Holden's analysis implies that if you have no income, e.g. as a student, you should wait to donate until later. This strikes me as basically correct but it is really really surprisingly important to give something on a regular basis - and put cognitive effort into efficient altruism / optimal philanthropy / rational charity, to get into that habit as well, even for small amounts.

At the end of every year, for example, you might donate $100 - or even $10, if $100 is too much - after looking over the latest list of efficient charities and doing some thought about where the $100 ($10) will do the most good, for purchasing utilons rather than fuzzies, just as if you were about to give $10,000. If the end of the year is far enough away and you don't have a trustworthy reminder system already set up, you might do that part now, then again a year later or at the end of the year, etc.

If you don't do this part, I would evaluate a surprisingly low chance that you would remember to start giving, and giving efficiently, later in life when you have income.

I think people tend to over-estimate rather than under-estimate the rate at which the goodness of expenditures decline in the future. Among other things:

• Holden raises the possibility that giving opportunities will be worse in the future, but if you assign a 50% chance of giving opportunities being twice as good and a 50% chance of giving opportunities being half as good, then you should wait
• 7.9% is a pretty reasonable rate of return
• Debt can limit your options and flexibility for life decisions like further education, moving, and entrepreneurship
• If you have a fast-growing process which will eventually saturate then earlier donations are not as much better as they might seem without considering saturation
• Our technology is advancing, so we are getting closer to big decisions, opportunities, and problems involving those technologies, and spending on them will be easier when they are more in sight; there were cool opportunities for spending in the 1500s (funding science as it was just getting started, or sending colonists to the New World, who increased in numbers by something like a hundredfold since then), but many options were not even visible

However, independently of these issues it makes sense to give small amounts to "keep the habit" and stay in practice and aware of charity issues.

An advantage to giving now, even if it's a small amount, is the example you set. Which is more likely to sway your friends: "I donate to (charity)" or "When my loans are paid off, I plan to donate to (charity)"?

Relevant: http://rationalconspiracy.com/2012/12/29/if-youre-young-dont-give-to-charity/

Hi ancientcampus, I'm in pretty much the same boat as you: same situation, same objectives. I'm not sure if you've heard of it, but I found the advice at www.givingwhatwecan.org really helpful. They have recommendations of the best charities, a supportive community, and advice for students.

What they suggest - and what I'm doing - is to not donate a substantial amount right now, but instead to wait until you're earning. However to get into/keep the habit of donating, a donation of 1% of your spending money is suggested.

As to whether you should wait to donate until after you have paid off your student loans, that would depend on what country you live in.

A point to take into consideration: If you have an income, the government will give you money if you donate to a nonprofit, in the form of tax breaks on the donated money. That gives you that bit more money to give. This is a important factor to take into consideration, as the amount of money the government gives you is not insignificant, it is the amount of tax you would have paid on that money, which can add up to a quarter or more of the amount.

2)If the most worthwhile charity I find see has a higher interest rate than 7.9%.

What do you mean by the interest rate of a charity here?

Depending on your area and schedule, you could try giving time and not money.

As a positive note of this: Some organizations really need volunteers and have easy to meet criteria for work that is not that hard. For instance, my wife started volunteering for a Feline Rescue Association in Baltimore, so on Monday and Thursday Mornings, she drives to the area, cleans up after cats, changes their food/water, gives people adoption papers and references the organization's website, etc.

As a more negative note of this: There are also organizations where they allow volunteers but the labor is substantially heavier, or they actually have a longer application process for Volunteers which may turn people off from volunteering. Also, a lot of the time volunteer places may not have your focus of charity. If you really want to give to Anti-Malaria Charities, there may not be an easy way to do that with time alone.

But it might be something to look into, if you have an urge to do good and very little cash. These kinds of opportunities are going to vary significantly by location.

This isn't really specific to the special case of having negative money. If you have $10,000 to give and can invest that in the stock market and earn money at a rate higher than your discount rate for lives, then you should invest the money in the stock market and give to charity in a years time. if this continues to be the case, you should continue to compound your money and will it all to charity when you die.

Now if someone can just give me a good way of figuring out what my discount rate for lives is, this would be helpful in answering this question for myself.

I'll presumably have a family and bills, etc, and while I am perfectly happy to live on little myself, I know I will want my kids to have nice things. This is somewhat illogical, but I'm imperfect.

What's illogical with that? (I'm asking because that's exactly my position too, but I can't see anything wrong with that.)

Long run (as in, 100 years on NYE) returns on the stock market are more like 9-10% if you re-invest dividends.

You might want to wait till you have a taxable income to claim deductions on.

Despite these two considerations, I agree with donating subtantially at present (and do so myself).