Proof That People on Budgets Are Actually the Most Generous

A large new survey from Tiller Money finds evidence that Americans who follow a budget are more likely to donate food, money, and time to food banks at Thanksgiving.

TLDR: It might seem counterintuitive, but people on budgets are the most generous, at least in terms of giving to food banks during Thanksgiving.

Recent Studies Reveal an Ongoing Hunger Crisis in America 

Despite our generally high standard of living, 1 in 8 Americans struggles with food insecurity each year.

  • People confront hunger in every county in America.
  • More than 46 million people turn to the Feeding America network each year for extra support.
  • That includes 13 million children and over five million seniors facing hunger today.
  • Households with children experience hunger at a higher rate than those without.
  • Research shows in households facing hunger, parents feed their kids before themselves.
  • Other groups most affected by hunger include the working poor, military families, the unemployed, and young college graduates.

Food Banks And Private Citizens Step Up to Help

Food banks are a critical link in addressing hunger in America. They feed millions of hungry families every single day. Thanksgiving and the winter holidays are often their busiest times of the year.

Many food banks get almost 90% of their support from small individual donations.

People can support their local food banks with donations of money, time (volunteering), and food.

While food banks receive federal funding and corporate gifts, donations from individuals make up the majority of their budget.

Indeed, many food banks get almost 90% of their support from small individual donations.

People Who Keep a Budget Are More Likely to Donate to Food Banks at Thanksgiving

At Tiller Money, we were curious to know if people who kept a personal budget were more or less likely to support charitable causes compared to people who don't follow a budget.

We didn't find much research on this topic, so we ran a large national survey asking “Do you use a personal budget to track your spending?” followed by questions about food bank support during Thanksgiving. 

We found strong support for the idea that people who keep a budget are more likely to donate to charity. 

  • Budgeters (42%) are more likely than non-budgeters (29.7%) to donate money to a food bank at Thanksgiving.
     
  • Budgeters (51.2%) are more likely than non-budgeters (40.5%) to donate food to a food bank at Thanksgiving. 
     
  • Budgeters (25%) are more likely than non-budgeters (14.4%) to donate time to a food bank at Thanksgiving.
Do you use a personal budget to track your spending?

Do you use a personal budget to track your spending?

  • Of 275 people surveyed, 59.6% (164 respondents) followed a personal budget, while 40.3% (111  respondents) didn't follow a personal budget.
     
  • The survey should provide 90% statistical accuracy across America for people aged 18 and up.

Why Do Budgeters Donate More?

Previous research found that the poorest fifth of Americans donated almost twice their proportional income versus people earning over $200,000 per year.

Greater exposure to and identification with the challenges of meeting basic needs may create “higher empathy.” Perhaps there's a similar mindset intersection in budgeters.

Another reason might be because many budgeting systems explicitly account for charity. For example, the 80/10/10 plan sets 10% of income aside for giving.

Also, there may be a  correlation between religiosity, tithing, and a peer group motivated commitment to a budgeting lifestyle. (Something to investigate in the future.) 

But that doesn't explain it all. So we reached out to some of our favorite financial experts and writers to ask if they were surprised by this finding, and to learn how budgeting and giving go hand-in-hand for them.

Joe Saul-Sehy, founder of StackingBenjamins.com:

When I was a financial planner I usually found that people who gave to charities were people who were more organized. At first this wouldn't seem to make sense....but of course when you think about it, the correlation is obvious.

People who are organized have more time to spend with a charity. They're more comfortable donating because they know what part of the budget will suffer as a result (if any). They can clearly see how the charitable donation will impact their life. Someone who is disorganized has to leave money in reserve. They aren't sure where it impacts their budget, and they don't have time.

Following a budget (and tracking my annual income) has made it MUCH more likely in a year that I'll donate. I personally know if a portion of my budget is going to suffer as a result, and I know where the money is going to come from (and how I'll replace it). Plus, because Cheryl (my spouse) and I have frequent budget discussions, the idea of giving to a charity is a natural offshoot of this system.

We love giving to charities in Texarkana to both help the institution and be a part of the community. Without a budget, it'd be difficult!

Jim Wang, founder of Wallethacks.com:

I think someone who budgets is someone who knows the value of their time and money since they keep a close on them every month.

A lot of anxiety around money is really fear of the unknown. Many folks don't like thinking about money because they're anxious about it, which means they know even less, which feeds into the cycle of fear. If you start budgeting, you know how much you're spending and saving and can adjust accordingly. If you're already budgeting, you can take away some of that anxiety and know that you have an extra cushion each month that you can use, especially over the holidays, to help others if you want to.

By having a budget and knowing how much we are spending and saving each month, we know how much our household can handle in extra spending - which includes donating money and goods to the organizations we care about. It's something we look to pass along to our kids, who often bring in non-perishable goods for food drives and other fundraisers.

Melanie Lockert, founder of DearDebt.com:

“Being able to know where your money goes and have a solid plan can give you some more breathing room to give freely. I definitely budget for giving back each month as it's something that is important to me.” 

Jillian Johnsrud, founder of MontanaMoneyAdventures.com

Budgets (with our time or money) are all about making sure our resources go to the places we value most. It's a form of intentional living. I think a lot of people would love to donate around the holidays, but it's so much easier if we have budgeted for that.

We make sure to set aside money each month for our giving so we always have a little surplus to donate. We are never caught off guard, or feel like we have nothing to give. We even set up a separate checking account for giving! We add a little to that each month from our budget. We give from that account so a big donation never affects our monthly budget. It was already budgeted for! 

Peter Polson, founder of TillerHQ.com:

I love this research, but it doesn’t surprise me when I look at myself.

We all feel pressures of time and money. I know I do, as both are finite in supply but infinitely in demand. Technology, marketing, and life’s distractions are really good at robbing us of both time and money. There’s always something in the news feed that can captivate us. There’s always something we can buy with a click or a swipe.

Budgeters put a process around their money to make sure their spending aligns with their needs, goals, and aspirations. I bet that people who budget their money are also good at making sure their time is well spent, too.

So how does this connect to giving? I believe we are all generous at heart. But to be generous in action requires some planning. We must put on our oxygen mask before helping others. If our budgeting process ensures we have enough, then it’s much easier to be generous to others too. Budgeting allows our values and our actions to align.

Zina Kumok, DebtfreeAfterThree.com

I think if you're using a budget, you're more aware of what your available resources are and feel more comfortable to give. Having a budget gives you a clear outline of your assets so you know if you can afford to be generous.

Kelley Olinger, Reconcileyourwallet.com

I think of airplane safety guidelines - 'put on your oxygen mask before assisting others'. I think budgeters have their oxygen masks on - they feel secure and calm in their ability to care for themselves leaving more time (and more importantly) energy for giving to others. Yes, as a budgeter, I donate household goods on a consistent basis to local charities. 

Brynne Conroy, Femmefrugality.com

I never would have thought about it, but this data isn't surprising now that I have. If you're scrambling at the end of the month or during the holidays, trying to guess how much you can afford and how many extra shifts you'll need to pick up, it's reasonable that you wouldn't be as quick to give of your own resources. You don't have enough confidence that you'll be able to cover yourself nonetheless others. 

When you budget, you can make more informed decisions about your time and money. You are more aware of your surplus if you have it, and therefore more comfortable sharing.

Jon Dulin, founder of  MoneySmartguides.com:

I feel that people who budget don't have the added stress and worry that money can bring into life. They know where they stand financially at all times. With this level of comfort, they are free to pursue their hobbies and help out with causes they care about.

By budgeting, I know where my family stands in terms of income and expenses and this allows us to donate some of our money to charities. We know that others are not as fortunate as we are and want to help out. While some months our income is less than others, we still give our time or donate goods that we no longer use to help out. 

How You Can Give

Most food banks prefer donations of money rather than food at Thanksgiving and throughout the year.

That’s because they can allocate their money exactly where they need it. Also, they can buy supplies at a lower cost than retail. A $10 donation can provide as many as 50 meals.

Many food banks and soup kitchens have a surplus of volunteers at Thanksgiving but need volunteers at other times of the year (including the minor holidays when help is hard to find.)

You can find a list of links to local food banks, soup kitchens, and food pantries here.