Three things to look for when donating to charities?

Answer 1

Three things look for when donating to charities

Many individuals with disposable income consider donating to charities a benevolent act of goodwill as well as a societal contribution. And while this is generally true, it is not common knowledge that all charities are not created equal. While it is obvious that the purpose and intentions of all charities differ -- some might focus on impoverished children, while others focus on improving access to clean water in the third world, while still others focus on helping the elderly -- many generous donors do not realize that each charity contributes to their cause in a different way.

This article will help shed some light on the charity donation process as well as the qualities in a charity that one should look for when donating. That said, what follows are three things to look for when donating to charities.

How much of your donation will actually be spent on the cause?

Many people mistakenly believe that every cent of their donation to charities will be funneled into the cause championed by the charity. What they fail to realize is that a charity, just like a for-profit corporation, incurs operational expenses that must be paid out of their income stream (donations). Some charities are more efficient than others, meaning that a higher percentage of donations get passed along to the intended recipient. Check the overhead of the charity you’re considering a donation with: how much of your money will be spent on the cause they champion?

How exactly does the charity contribute to the cause?

Some charities have more direct funding strategies than others; if a charity uses a third party to disseminate its funds, not only does less of your money make its way to the cause, but there’s usually no way to audit how the third party functions or even if it functions at all. Try to find a charity that operates on the ground; that is, it provides aid directly instead of contracting another company to apply the funds for the purposes in which they were raised. Not only does this ensure that your money is spent wisely, but it also ensures that proper US laws are followed in the charity’s operations.

What is the charity’s mission statement?

Charities sometimes operate under ideological principles, and those principles may not match your own. Just because a charity claims to help fight illiteracy in the third world, it doesn’t mean that the charity is doing so in a way that you’d support. Dig deeper into the charity’s mission statement than simply reading a few paragraphs on its homepage: you want to know how exactly your charities are undertaking their advertised causes.

These tips should help you not only maximize your contributions to charities but also to select charities wisely and with the right information at hand.