Give to charity by just going about your day-to-day finances

It’s that time of year again when we’ll have Lenny Henry leading the Red Nose Day activities on our TV screens, asking us to dig deep, participate in silly fundraising activities and support our favourite celebrities as they embark on reality TV shows.

Whilst the high profile events such as Comic Relief and Children in Need undoubtedly raise significant amounts of money for worthy causes, consumers can donate every day of the year by using financial products linked to charitable causes.

Credit Cards

Michelle Slade of Moneyfacts.co.uk comments: “There are over 40 charity related credit cards on the market, enabling the consumer to use a card linked to the charity of their choice. Most cards will donate a specific amount when you first use the card, followed by a further percentage donation each time the card is used, linked to the amount you spend.

“The Comic Relief Visa has also announced it will double its contributions throughout the month of March from its already generous 0.5% to 1% of purchases. While the initial donation from this card is relatively low at £6 compared with other cards, it will prove the most generous card in the longer run if you spend regularly on you card. Also the card is one of the few that has no handling fees for foreign transactions.

“Undoubtedly the donations provided to charity from these cards will be greatly welcomed, but make sure you are not giving up better deals in the process. If you can save yourself a few pounds by finding the most competitive deal, then you may even have some spare to donate to any charity of your choice as and how you choose.

“Anyone using a donation card who carries over balances from month to month, may find themselves paying an above average interest rate, with the typical rate being 18.9%, ranging from 12.9% to 18.9%.

“Balance transfer and introductory 0% deals also tend to much shorter than the market leading deals, with the exception of some MBNA cards, which offer 12 months’ interest free balance transfers, with the norm only six months.

“Make sure the card you choose best matches your financial circumstances, and don’t sacrifice a great deal just to commit to giving to your charity. Remember any money saved can be given to your chosen charity.

“If you pay your balance in full, then the interest rate does not matter – so why not give to charity as you spend?”

Savings Accounts

As well as using charity credit cards as a way of donating, you can also open a savings account where a percentage of your average balance or in some cases some of the interest accrued on your savings will go to your chosen charity.

Rachel Thrussell, Head of Savings at Moneyfacts.co.uk comments: ”Whilst the charity affinity savings accounts do not pay the highest rates available, they are by no means the lowest on offer.

“Not all consumers are concerned with receiving the top rate of interest, but they would be prepared to settle for a more modest return for themselves in return for a donation being made to a national or local charity of their choice.

“There are currently over 35 charity accounts available, covering many local and national charities.

“As many of these accounts pay rates of interest below inflation, in the longer run it would not be wise to hold all of your savings within these accounts. However they can provide a great contribution to any linked charity and can sit well within your portfolio of savings products.”