Quite often we get questions about how to tailor the Suggested Fair Share Contribution Guide for people who do not have regular paychecks or predictable income streams. This includes retirees who draw from IRAs or 401Ks for much of their living expenses, and for whom Adjusted Gross Income understates their income and financial capacity.
It also includes people whose incomes depend on bonuses or commissions that vary substantially, and do not want their financial commitments to bounce up and down from year to year. So how might people in these and similar situations think about their income for purposes of the Guide?
Before answering that question, let’s review some general concepts about the Guide and giving to our congregations. First, the Guide is intended to encourage everyone to do their fair share. It embodies our Unitarian Universalist progressive values, meaning that people’s giving should reflect their capacity: the more you earn and have, the more you can afford to give. Hard to argue with that.
Second, giving to our congregations is different from other charitable giving. While other non-profits have many potential sources of funds, our congregations have only us. When we join a UU congregation, we enter into a sacred covenant with one another. For my wife and me, this means we treat our financial commitment to our church as a non-discretionary expense, much like our mortgage, groceries, and car insurance. I hope you and your fellow congregants see it this way too.
With that background, let’s address the specific questions at hand.
For retirees: I suggest retirees define their income as the total amount they draw to live on, whether that comes from Social Security, pensions, retirement plans, part time work, or savings. Basically, their monthly or annual income budget serves as the starting income for the Guide, before adjustments.
For those with variable incomes: I suggest thinking about this pretty much the same way: define income as whatever funds are drawn to live on, including savings from the good times that balance out the lean years. After all, most people don’t change their non-discretionary spending dramatically depending on how large a bonus they receive – they don’t move to a less expensive house or change schools for their kids in a down year. Rather, they view these as firm commitments. Shouldn’t our congregational commitments be as firm?
While we’re talking about retiree income, remember that people subject to the Required Minimum Distribution (RMD) from their retirement accounts can enjoy a nice tax break by donating some or all of the RMD directly to their congregation. Note that the funds must be transferred directly to qualify for the tax break.
The bottom line is that the Guide is a tool to help us give what is fair. As with many things UU, we are each responsible for finding our own path, including our own level of giving that’s consistent with our sense of covenant and shared commitment. I am certain that if each of us makes a financial commitment that makes us proud, our congregations will have the financial resources to support our mission and grandest dreams.
Barry Finkelstein is a consultant with Stewardship for Us. He welcomes your comments on this post, and can be reached at Barry@StewardshipforUs.com.