is addressed to the Holy Prophet (s.a.w.s.) but it is meant for the guidance of the common Muslims. Muhammad Ibne Makki was of the opinion that the rules of charity vary with person to person. The traditions, which imply excessive selflessness, are only for those who give their personal belongings to the needy and the traditions that hint a moderation even in charity are meant for those who have wife, children and family etc. Such a person cannot prefer others to his own children. He cannot give away whatever is necessary for his family to other needy people. Sacrifice of our own needs is allowed but it is not permitted to give away the requirements of our family and children. The honourable scholar has also stated that it is makrooh (detestable) for a man to donate his total wealth in charity unless he is sure he will be able to bear the consequences. Also it is necessary that he does not have the responsibility of a family or children.
(Daarus Salaam of Noori)
Sayyed Muhammad Kazim Yazdi also remarks that according to the Holy Quran, sunnat of the Holy Prophet (s.a.w.s.) and the unanimous opinion of the scholars, Israaf is Haraam, there is no objection against this verdict. Israaf is the expenditure on useless things which is considered as wasteful by common sense; whether the amount spent is appropriate to the occasion or not.
Is Israaf possible in charitable deeds? Some of the scholars including Sayyed Muhammad Kazim Yazdi believe that it is possible. Some well-known jurists have stated the contrary. According to the traditions, "There is no goodness in Israaf and no Israaf in goodness." But we should know that the former opinion is more precautionary on the basis of other traditions on this subject.
After quoting the traditions of Ibn Abi Umair and Sahih of Bazanti and other sources, the late Sayyed says, "The ayats and narrations denouncing wasteful expenditure revoke (mansookh) the ayat of selfless sacrifice." Therefore it apears that it is not proper to sacrifice and to give gifts extravagantly which are not appropriate to the status of the donor, or which common sense perceives such generosity to be excessive. There is no logic in giving and taking of such gifts and donations. As mentioned earlier wasteful spending in necessary matters is also prohibited. The only exception being the expenses of Hajj and Umra which are not subject to any limits. The Holy Prophet (s.a.w.s.) says,
"No spending is more likeable to Allah than one which is moderate and except for over-spending in Hajj, He dislikes all types of extravagance."
(Safinatul Behaar)
source : http://www.al-shia.org