We’ve all heard about the many different crowdfunding organizations out there. Probably the most famous of them is Kickstarter. Or maybe Indiegogo. Adam from Man vs. Debt recently crowdfunded his documentary “I’m Fine, Thanks” through Kickstarter. Using crowdfunding sites has become pretty popular. It’s a great way for artists and creators to fund the products that they are creating through the fans while still giving something back to the fans.
Recently, I found a site called GoFundMe. It’s another crowdfunding site. Except, in this case, it’s more of a crowd fundraising site. Personal crowd funding if you will. Individuals and organizations can post a need, and then share it with friends, family, and the public through social sites and links that they can share. Their friends, family, and anyone else interested can then go and fund the need. Best I can tell, there aren’t many restrictions at all as to what it is that you can post as a need. Want to use it to fund the down payment on a house? It’s been done. Want to use it to pay for a wedding? Been done.
Anytime I see something like this, my mind starts to wander about and find stuff that’s a bit “funny.” I can see the good of a site like this. It only takes a few seconds on their homepage to see that there are lots of people using the site to help people in need. People who have medical issues. People who have had house fires. People who want to set up memorial funds. I can even see how it would be kind of cool to create one to have people contribute to a wedding fund or honeymoon fund instead of buying wedding presents. But, with every one of those that I see that seem to be legitimate things that people might want to create a fund, I see ones where you really have to wonder what some people are thinking.
[Tweet “you really have to wonder what some people are thinking.”]
For instance. I ran across one that was a fund to help with the down payment on a new car. Another asking for help with a down payment on a house. It’s ones like that where my cynical side really comes out. I’d like to think that the people really have just had a bit of down luck and just need that little bit to dig themselves out of a hole. Or that little push to keep going to work. Or whatever. But, there’s that personal finance blogger side of me that wants to know why, if you knew you were going to need a car, or wanted to buy a house, weren’t you saving in the first place?
I guess there’s a small chance that the fund wasn’t intended to be seen by anyone more than the persons friends and family. But, it is public. And then there’s the question of taxes. If I go create a fund, call it my retirement fund, and then raise a million dollars, what does Uncle Sam think of that. I did a little digging, and, according to the sites FAQ section, they state that “most donations on GoFundMe are simply considered to be ‘personal gifts’ which are not taxed as income in the US.”
Which makes me wonder. Maybe I should create a “don’t want to work anymore” fund. Set a goal of about $45,000 and see if I can’t take a year off work…
What do you think? Am I being too hard on this? Are you going to go out and give it a try? Would you give/donate to someone you knew who used it?
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Great article. I suppose this is a little bit like Peer to Peer Lending, as practiced by companies such as Prosper. That never really took off in a big way.
Something that’s started to work here in SE Asia is the Loan Garage approach, where a middleman/aggregator connects borrowers to lenders. Worth checking out.
I guess if people want to give you money and you are telling them what it is for then I can’t really blame anyone for being able to get money by doing nothing. I guess I have come to the point where you have to work to get what you want and need.
I’m not impressed by people who want others to pay for their house, wedding, etc. But that may just be me.
Haha… I want to post an “I don’t want to work anymore” fund, too! Totally see your point here — I was sent a bunch of offers by companies to “settle” my debt for about 1/2 of what I owe. But I just couldn’t wrap my brain around it. I mean, I borrowed the money. I spent the money. Why shouldn’t I pay it all back? But to each his own, I guess..
South Park did an episode about the gang running a fundraiser so they do not have to go to school or work anymore. It is called GoFundYourself season 9.
I also have a fundraiser going to help get me out of debt. To be honest I wondered why people seemed angry, mocked me or just ignored me. To be honest I wondered why. To me being out from under debt means that I can rent an apartment, buy a house and buy things/services from their companies. (Especially as a thank you).