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The pandemic has been hard on charities – donations plunged, staff were laid off and some organizations are closing down.

It’s not just job losses and reduced income caused by closing down parts of the economy. People who have money are feeling cautious about spending it, or they lack the opportunity to spend. That’s why there’s an estimated $90-billion more in bank accounts than there would have been without the pandemic.

A reader, Nicole from Toronto, contacted me this week to ask about giving some of that $90-billion to charity. “As the year comes to an end, we are some of the lucky ones who find we have saved a lot of money during the pandemic,” she wrote. “I would like to propose to my spouse that we donate some of it. Can you help me with understanding the financial benefits of donating?”

Sure thing. There’s a 15 per cent federal tax credit on the first $200 you donate, a credit of 29 per cent on donations above that amount and provincial charitable tax credits as well. An easy way to see how much of a tax credit you’ll get is to try this calculator on, a hub for finding charities and making donations. Further tax information on charitable giving is available here.

“Maybe others would be persuaded to donate to charity by year end if they see the personal benefit, other than just feeling good about supporting causes you care about,” Nicole from Toronto wrote in her e-mail.

Let’s hope so. Charities need help and some of us are fortunate enough to have money to provide it. Final note: Charity Intelligence Canada can help you find charities that score well in areas like demonstrated impact and financial transparency.

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Rob’s personal finance reading list

The ins and outs of a career timeout to raise kids

A look at financial and non-financial considerations for mothers who leave the work force to raise their children.

Canadian taxpayers and the Biden administration

Thoughts on how Canadians and Americans living in Canada might be affected by tax proposals from President-elect Joe Biden.

How to control your holiday spending

Among the worksheets offered on is one for gift budgeting. Handy for organizing how much you’ll spend on whom.

Renters were winners in 2020

Rents fell hard in Toronto during the pandemic, but there’s reason to expect a rebound in 2021. Don’t wait too long if you live in an expensive urban area of the country and want to find affordable rent.

More good news for renters: Making your monthly payments on time can now be used to build your credit score.

Ask Rob

Q: Are there any good mutual funds with a management expense ratio less than 2 per cent?

A: Most definitely. To start, check out TD e-series index funds. They’re well below 1 per cent. Traditional mutual funds with MERs firmly below 2 per cent can be found from such companies as Beutel Goodman, Mawer Investment Management, Phillips, Hager & North and Steadyhand. If you invest in funds through an online broker, check out Series D versions of a wide variety of funds from major fund companies. Series D have low MERs, typically below 2 per cent, because they’re designed for DIY investors who don’t want advice.

Do you have a question for me? Send it my way. Sorry I can’t answer every one personally. Questions and answers are edited for length and clarity.

Today’s financial tool

Look out for an app called TipTap that lets you make small charitable donations with a tap of your credit card or smartphone. The Salvation Army is using TipTap this holiday season.

The money-free zone

A song I really liked in 2020 is Years, by the country music great John Anderson. Kind of an anthem for a tough year.

Video of the week

Have extra savings? Put them to work helping those hit financially by the COVID-19 pandemic.

In case you missed these Globe and Mail personal finance-related stories
  • Ten money insights distilled over 25 years
  • Canadian families will pay up to $695 more a year for groceries in 2021, report says
  • TSX stocks are back to hiking dividend payouts after pandemic shock ignited a slew of cuts and cancellations (for Globe Unlimited subscribers)

More Rob Carrick and money coverage

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