Confession: I struggle to know what to do when I see homeless people. Can you relate?

Man with sign: 'Help! Need money, God bless you'
Two nights ago I was coming home from a group meditation and I experienced something that almost made me come undone. It was 10pm on a bitterly cold winter's night, teeming with rain, and there was a homeless man on his knees proffering a paper cup to the thighs of dallying drunks and harried corporates rushing by for shelter. I crossed the road to give him $5 and, in a soft, gentle voice completely incongruous with someone who is living a hard life, he thanked me and said he hoped I got home safely. I have never felt more guilty for having a home to go to. I had to turn away because my eyes were leaking for reasons that had nothing to do with the rain.   
There are so many homeless people around Sydney – particularly noticeable at this time of year, when it’s so cold – and sometimes walking to work in the city past so many people hiding under tattered blankets is to run an emotional gauntlet. I do give money to a few of them on a regular basis, but there are so many that I have to limit it to only two people, and I have to admit I do find myself subsiding into a state of compassion fatigue.
Basically, I become so used to seeing people in these wretched conditions that it has become normal to me. Which means I do nothing to help, despite my life of extraordinary privilege. Note to self: there is nothing normal about this level of human suffering. 
I know people who refuse to give money to homeless people on the assumption that they will only spend the money on ice (that’s the drug Americans know as meth, and New Zealanders know as P). I have always thought that it’s not my place to judge someone for what they do with their money, and frankly, if someone is on a street corner dressed in rags and reeking of urine, they need my gold coins far, far more than I do. There’s nothing I can do with that meagre amount of money that will hold as much value to me as it will for someone living in the depths of despair, whose entire existence depends on the kindness of strangers. That said, I have no judgement towards people who opt not to give their money to homeless people. Your money is your own, and you’re certainly not obliged to give it to anyone.
Beggar with outstretched handsI think I harden my heart against the homeless sometimes out of a fear that it will upset me (for good reason). For that reason, my response typically goes one of two ways: I’ll hurry by and distract myself so I don’t look (which makes me feel guilty). Or I’ll give money but practically throw it at them, speeding off before I can hear them speak to me. I know logically that I can only give so much (although I could certainly do with giving more than I have been) and I can’t help everyone, so my guilt is misguided – not to mention unhelpful. I also know that, in truth, kindness isn’t really kindness if I’m giving begrudgingly or defensively. It would probably be more valuable to actually have a conversation with homeless people, ask them questions and listen to their opinions, to remind them that they matter (we all need to be reminded of that, actually), and perhaps bring them a sandwich, a banana and a newspaper. This is one solution I’m considering.
It’s pretty clear by my increasing discomfort levels that I need to change my approach to this morally complex situation, and I don’t think money is the answer.
The ‘how’ is probably less important than the ‘why’. And the ‘why’ is because compassion is one of my fundamental beliefs. Mother Teresa knew a thing or two about kindness so I’ll throw to her now: “I prefer you to make mistakes in kindness than work miracles in unkindness.”

Quite.