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Given the news that inflation has risen once again, it may not come as a surprise that there has been a drop in the amount that is being donated to charities this year compared to last. However, the drop may be less severe than expected considering the increasing cost of living.
Indeed, while 24% intend to donate less to charity this year compared to 2016, 12% expect to give more. This leaves 47% who intend to donate about the same amount, as research by Cambridge & Counties Bank has revealed.
Of those who are donating less, 15% are giving £50 less, while 6% are decreasing their donations by between £51 and £100, and 3% are giving over £100 less. Only 1% said they'll be giving over £300 more, with 5% intending to give up to £50 more and 3% expecting to give between £51 and £100 more.
The main reasons for giving less are a fall in disposable income, cited by 39%, followed by the rising cost of living, which 36% cited as their main motivation. A further 24% said the reason they were donating less was due to a change in personal circumstances.
To make matters worse, an analysis the bank has undertaken of Business Moneyfacts data from October reveals that charities are getting very poor returns from their charity deposit accounts, with 30% offering returns of 0.1% or less (on balances of at least £10,000). In contrast, less than 1% of deposit accounts open to charities pay a rate of 1.00% or more.
"Charities rely heavily on donations and if they see a drop here it could adversely affect the services and help they provide to millions of people," commented Rachel Curtis-Bowen, chief customer officer at Cambridge & Counties Bank. "Charities can offset the impact of any fall in donations by making sure that the interest rate they receive on their cash deposits is competitive, and if it's not they should be prepared to switch to a different provider or account."
If you'd like to keep donating to charity, or even increase what you're giving, consider setting some money aside in a Best Buy savings account or switching to a high interest current account and giving your interest away
If you're involved in running a charity, on the other hand, have a look at our charity savings accounts to see if you can get higher returns on your donations
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