A friend’s son will be celebrating his bar mitzvah soon. His parents have told him that he must give 50 percent of any monetary gifts to charity. He says that he wouldn’t give any of his money away if it were up to him. One of the boy’s current passions is computer gaming. I asked him if there was an option in Grand Theft Auto to give away half of your winnings to charity. Apparently there is not.
What do readers think? Will making a 13-year-old give up his dream of Alienware in favor of choosing a 501(c)(3) make him a better person in the long run? And, if so, what is a charity that a 13-year-old might donate to? (let’s first check the Form 990 at guidestar.org to make sure that the executives don’t earn over $1 million/year)
Could the teenager reduce his tax rate a little by asking guests to give him physical things instead of money? What if he spreads his dream gaming computer across an Amazon wishlist or similar and asks people to buy him one component at a time?
Finally, can we argue that this is important preparation for becoming an adult American? He will have to learn to hand over approximately 50 percent of his income (or up to 90 percent, depending on the state and the judge’s mood, if he has an encounter with the U.S. family law system) going forward. So maybe he needs to learn how to do that cheerfully?
[One of my MIT 1982 classmates had this to say: “My son and I just took care of his donations from his bar mitzvah. We had settled on a more standard 10%. While it’s true that most of our children want for nothing and could easily donate 50% or the whole amount for that matter without missing anything, our practice has been to instill in them the responsibility of always giving 10% per our tradition. We talk about it as a family, they see us do it personally, and he had the benefit of seeing his sisters do the same before him. I would hope that the tzedakah (charity) would be a positive thing and reinforce the notion of a bar mitzvah as joining the ranks of Jewish adults, which of course entails additional responsibilities. And if the 13 year old is set on a gaming laptop, what’s wrong with using some of the gift money and, if that’s insufficient after making the requisite donations, earning the rest through baby-sitting or other age appropriate jobs? I know we struggle with teaching our kids the value of money simply because they’ve never had to learn the hard way.]
10% seems reasonable. I read somewhere [citation needed] that folks in the Effective Altruism community have calculated that if everybody gave 10% of their income to charity, it would be several times the amount required to eliminate global poverty. 10% is a good target to give people who struggle with the issue of “as long as there is at least one starving person on this planet, it’s immoral for me to buy a cheeseburger for myself”. If you’re giving 10%, you’ve done your part and then some; go enjoy the rest guilt-free.
An instance of what on Twitter is know as #WhitePeopleProblems.
Here’s a story about a 13yr boy who collected $17,230 cash at his Bar Mitzvah. His father took it all then told him, “Your Bar Mitzvah cost $38,000. You owe me $20,770 at 12%. You’re a man now.” The result? He built and sold his first company at age 14, followed by much more entrepreneurial success.
http://www.businessinsider.com/founder-story-selling-company-2014-9
My big problem with charity is that much of the money gets diverted to the CEO and executives of the charity, and they have no “stockholders” to answer to, even if the charity starts to falter. I notice very rich people more often than not, do charitable work by constructing or buying something that is needed, e.g. build a building, buy an MRI machine, etc. This eliminates the middle man and is much more effective. The middle class guy can do something similar, on a smaller scale, too, e.g. give to your local social group that is trying to support the library, buy new bleachers at the school, buy dog food for a year at the local shelter, etc. In these cases you can be sure your money is really effective. In general, ask what a charity needs rather than just giving them money for their general fund/CEO piggy-bank. Much more satisfying.
I don’t know anyone whose bar mitzvah kids give ANY of their gifts, money or physical to charity. However, most of the bar mitzvah students I know now (all of them really) have a bar/bat mitzvah project which often involves dozens if not hundreds of volunteer hours.
Maybe he can keep the money if he works to bridge the local digital divide as he sees fits.
At any rate, today he is a man, maybe he should decide for himself.
It is a good prep for when he has to give 50% of his income to the government or an ex spouse
This discussion is incomplete without consideration of the people who will be giving the gifts. The kid currently doesn’t have any of the money in question. He will receive a bunch of money from other people and then forward half of it to the 501(c)(3) of his choice. The parents may be trying to make a point about sharing a windfall that occurs due to no particular effort on the part of the recipient. On the other hand, if there’s a significant amount of money involved, is it a good idea to allow the choice of charity to be made by a child of thirteen? Perhaps it could be a little family project for the kid and his parents to research some charities together and discuss how to choose the best organizations. This could be preparation if the goal is to turn the kid into a charitable adult. Yet it might be better to tell family and friends to take half of what they were planning to give as bar mitzvah and donate it to charities of their choice. That way they would get a small tax deduction.
I agree with Jerry 100%. If having a bar mitzvah means he’s a “man” then the give or not give choice should be left entirely up to him.
I don’t know anybody whose Jewish right of passage children give ANY of their endowments, cash or physical to philanthropy. In any case, a large portion of the Jewish right of passage understudies I know now (every one of them truly) have a bar/bat mitzvah venture which frequently includes handfuls if not many volunteer hours.