Those with money, who instead donate their time, are giving up time they could be creating more money. They are donating time that could be spent creating more wealth. Those that are not rich are are presumably donating their time outside of their working hours.
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They still need to work to make money, but they cannot afford to give up their work time.
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http://scottdomianus.com/charity-tax/ if you want to know how to increase charitablity in polities you should read this.
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The value of real time donations is that you might get a better perspective on the problem you are trying to alleviate. If you work directly with the homeless one hour a week, you are likely to understand the issues/complexity more than just writing a check would allow.
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This doesn't explain why people bias time-investment as a third party. If you know what charity is effective you should much rather a large check from a wealthy donor rather than have that donor volunteer for your charity.
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