Check Your Charities
Giving to charity ought to feel good. But with about 2 million nonprofit organizations vying for donations, it’s not always easy to know which ones deserve your support. And while most are transparent about where the money goes, you might be surprised by some of the details. That was certainly the case earlier this year when the Susan G. Komen for the Cure foundation briefly pulled funding for breast cancer screenings from Planned Parenthood, prompting strong reactions from many donors. “People frequently make a donation to a charity because they like the cause, but without fully understanding the types of programs they are supporting, or how much of their donation will actually go to the cause itself,” notes Laurie Styron, an analyst for CharityWatch (formerly the American Institute of Philanthropy) in Chicago. Here’s how to make sure your money goes where it will mean the most to you and the causes you want to support.
Read the reviews » Take a look at the charities’ goals, programs and financials on their websites, but also check out watchdog groups that review nonprofit organizations to determine how efficiently they’re run, as well as how transparent they are about their spending, such as CharityWatch (charitywatch.org), Charity Navigator (charitynavigator.org) and the Better Business Bureau Wise Giving Alliance (give.org).
Crunch their numbers » CharityWatch recommends seeking out highly efficient charities that are able to spend at least 75 percent of their budgets on program services. The remaining percentage, ideally 25 percent or less, should be spent on fundraising and general administration—otherwise, too little of your donation will go to fund the programs (or cause) you intended to support.
Pinpoint your preferences » You can further narrow your search by deciding where you want your money to go. “Some cancer charities will spend most of your donation on research, others on direct assistance to patients and still others on pamphlets, TV ads and other types of awareness,” says Styron. “Don’t assume that just because a charity has a cause you believe in that it operates the types of programs you are interested in supporting.” Do your due diligence and donate from there.