This is one of those posts of me “thinking out loud.” It’s a chance for me to reflect upon one of the most sensitive topics in personal finance: trying to find the right amount of money to give to charity when you are in the beginning stages of wealth accumulation.
One of the “life models” that I keep in mind has been the path that Warren Buffett has chosen to follow with his own charitable giving. For most of his 20s and 30s, he did not give much to charity. He had set up The Buffett Foundation to give $20,000 here and $75,000 there to specific causes, and according to Roger Lowenstein’s Buffett biography, that only constituted 3-5% of his annual income. According to Lowenstein, most of Buffett’s early charitable acts were done at the behest of his wife Suzzie, and he generally viewed charity as a hindrance in the wealth-building process.