Most of us find a sense of satisfaction of doing good when we play a role in any number of worthy causes. But we also wonder where our charity is being applied. Ideally, we’d like to know the money we’re donating is being used the way we hope it will and that we’re indeed making a difference.
Often, we don’t have time to do the research of which charities have the biggest percentages that serve the purpose versus going into some administrative cost column. But fortunately, there are a few things we can look for before we give the website our credit card numbers. Here’s what we found.
As simple as it sounds, looking into the charity’s mission statement, usually found on its “About Us” page can provide insight. You want to be sure its values are similar to yours. If it’s a hunger charity, does it spend money on eradicating poverty? Has it worked with food manufacturers to ensure more bang for its buck? Or does it seem like there are entirely too many directors, founders and “faces” of the charity?
You can also learn a lot from its IRS filings and charities are required to file annual reports. Here you’ll find the details of where its monies are going. You want to be sure those administrative costs are much lower than the actual money spent on eradicating hunger.
There are several websites you can find this information, including the Better Business Bureau and the American Institute of Philanthropy. While it can be difficult understanding all of the legalese, ultimately, your goal is to be sure the money’s being used as it was intended.
To that end, there’s a rating systems on both of these sites with the target goal of a charity to spend no more than 35% on those administrative costs and fundraising efforts. Ideally, your charity will have less than a 35% ratio.
Here are specifics to look out for, too.
To put it simply, you should be looking for charities that stress its transparent policies, not working double time to keep them out of the public eye. In fact, one might say charities have an obligation to provide that information with no double talk and clear efforts of dancing around the subject. If it’s reputable, it will make sure donors and the general public can find the proof easily. It will also provide its achievements, too.
Who wants to donate to charities who use aggressive tactics? Frankly, those charities that have big name celebrities and brutally heartbreaking commercials are no-go for many donors. One woman we spoke to said,
Honestly, nothing infuriates me more than to see those extended television commercials of sad looking puppies and kittens and then the face of some big name star touting the reasons why this charity deserves my money. I want to say to the TV ‘Yeah? Well you come soothe the hurt feelings of my two kids who cry every time this commercial runs and then I’ll consider it. I’ll never give my money to an organization like that. You make my kid cry and then pay some big name celebrity to do it? You don’t get my money.
Reputable nonprofits don’t use pressure tactics – it’s as simple as that. It should be willing and more than happy to send you information you need to make an educated decision. You want questions answered easily with no run-around and you want no aggressive efforts either. That’s not too much to ask. If your gut’s warning you, heed that advice. There are too many that will serve their purposes without leaving you lying awake at night wondering about your choice.
All of us have received those return address stickers over the years. Have you ever noticed that they’re not useable? They either have misspelled your name or they have abbreviations that the post office won’t recognize. It’s frustrating considering every time you drop all that paper in the trash can, you might as well be tossing that donation you made last month into that same trash can.
It costs money to print all of those stickers, certificates, greeting cards, etc. To that end, our family has made the decision to not support those charities and if we make a decision to support a new charity and we soon receive mail for other charities, that means our information was sold. We then cease our support and choose one that’s not going to fill our mail boxes.
Finally, remember your donations to charities are tax deductible. It can lower your tax bill and reduce your taxable income – but only if you have maintained solid records of your contributions throughout the years. If it’s less than $250, you may only have a copy of your canceled check – but that’s acceptable to the IRS. If you have questions about the legalities associated with your tax deductions, you’ll want to speak with your accountant.
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