'Tis the Season to Give

In the days and weeks before Christmas, Ursula Gerst receives a good deal of mail. Friends and relatives send greeting cards, and of course the insurance companies never forget to send bills for the new year. But charities also write to the 77-year old, reminding her that Christmas is a time to think of others and that the best way to do so is through donating a few euros to help out others less fortunate.

“I look at all their requests very carefully,” she said. “And then I say to myself -- because they keep writing and insisting – I really should donate something.”

It’s not a coincidence that charitable organizations increase their marketing efforts during the holiday season. They know that Germans are in the mood to give at this time of year. Of course, emotional pleas from wide-eyed and hungry children on television and posters help move even the stingiest Grinch to donate money.

Give until it hurts

Despite a sputtering economy, rising unemployment and an overall financial insecurity at the moment, Germans’ willingness to spend money for a worthy cause is unbreakable. In 2003, they spent €2.3 billion ($3 billion) on charities, according to the Central Institute for Social Research.

A quarter of all the money donated went towards culture and monument preservation as well as the protection of animals and the environment. Three-quarters – the greatest share of their donations -- went towards humanitarian aid.

The chairman of the organization overseeing charities, Bernd Beder, said the Catholic and Protestant Church were at the top of the list, followed by the SOS-Kinderdorf – an organization for the protection and welfare of children throughout the world – the Red Cross and the emergency aid service of the Johanniter. Next on the list are the organizations Caritas and UNICEF, World Vision and various aid groups working with children.

Some 40 percent of all German adults donate money. Even if the amount spent varies greatly from person to person, statistics show that on average each spender donates €66 every year to a good cause.

But who are the people who year after year give money to help orphans in Latin America or finance a school project in Africa? The younger they are, the less they give; and the older they are, the more generous they become, Beder said.

“The older spenders contribute disproportionately more to the overall volume of donations," he added. "Perhaps that’s a result of the older generations having more of a sense of charity; but it could also simply be that older people have more money.”

Contrary to an often heard rumor, women do not donate more than men. Beder said women may give to more charities more often, but the overall sum of their contributions is less – most likely owing to their generally lower incomes.

More interesting, he said, is the tendency among the poor to donate proportionately more than the wealthiest members of society, in terms of their financial resources.

Why donate?

There are some 500,000 registered organizations and approximately 12,000 foundations in Germany. Nearly all of them are recorded as non-profitable. That means, they can offer tax breaks for donations. Last year 7.5 million tax payers took advantage of the charitable donation clause to deduct from their tax payments, according to the Federal Statistics Office.

But the revenue system and tax collectors don’t seem to be bothered by this loophole. On the contrary, Thomas Hofmann, a Cologne-based finance officer, said donations are actually good for the economy.

“When I donate money to a non-profitable organization, I help keep the charity afloat financially and it can build up its savings and doesn’t depend on state subsidies to survive," he said. "That’s one of the main reasons, why donations can be deducted from the taxes.”

That could also be another – albeit it less philanthropic – reason why Germans like to donate more during the Christmas season: They rediscover their charitable side just in time for a tax receipt to be written out for the next year’s tax forms.