Charity
What is the source of the Mitzvah of charity? The bible states, "If there be amongst you a needy man from amongst your brethren within any of your gates in your land which the Eternal your God gives you, you shall not harden your heart nor close your hand from your needy brother. You must definitely open your hand to him, and must definitely lend him on pledge sufficient for the needs in which he is lacking" (Deuteronomy 15:7,8).
How much of one's income should go to charity? One is obligated to give a tenth of his income to charity. It is meritorious to give 20% (Yorah Daiah 249:1). There are many examples of giving (a tenth or tithe) in the bible although there is no direct commandment. Abraham gave Melchizedek one-tenth of all his possessions (Genesis 14:20); Jacob vowed to give one-tenth of all his future acquisitions to the Almighty (Genesis 29:22). There are also mandated tithes to support the Levites (Numbers 18:21,24) and Cohens and tithe for local poor (Deuteronomy 26:12).
How much should one give to an individual? The Vilna Gaon taught that the principle of supplying each person according to his needs is hinted to in the verses written in the previous paragraph. When a person shuts his hand, his fingers give the appearance of all being the same length. When a person opens his hand, however, he notices that each finger is a different length. So too with charity. Every poor person has different needs and our obligation to each one is in accordance with his unique situation. "Do not shut your hands" (verse 7); that is, do not give equally to every individual. "You shall surely open your hand" (verse 8); that is, notice that everyone is different, and give accordingly.
How does one give charity? It is often hard for people to part with their money. In the first paragraph of the Shema prayer (our most important prayer), it says, "You shall love the Lord your God with all of your heart, all of your soul and all of your money." The Rabbis in the Talmud ask, "Why does it say, 'All of your money?' The answer: for some people, parting with their money is more difficult than parting with their life. (For those old enough to remember Jack Benny -- who happened to be Jewish -- now you know the source of the joke for his "I'm thinking it over" response when challenged by a robber "Your money or your life!")
One easy method for those who receive a paycheck with taxes deducted is to take one-tenth of the paycheck and deposit into a separate philanthropic account. It keeps the accounting honest and makes it easier to fulfill the Mitzvah. If one has investments he needs to make an accounting semi-annually or at least annually.
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