Giving now vs. later

Abstract

Money spent helping the poor compounds over time, but eventually you are just contributing to a representative basket of all human activities. If you donate a year later, you earn 1 extra year of market returns and 1 less year of compounding in line with economic growth. So, if you’re considering donating to a cause like developing world aid, you shouldn’t donate sooner rather than later just because the poor can earn higher returns than you can. Instead, you should look at the total multiplier you’re getting on your money and only donate if you expect that multiplier is declining faster than the difference between market rates of return and economic growth. Several additional reasons to give now rather than later are presented and briefly discussed. – AI-generated abstract.