A Guide to Making the Most of Your Charitable Giving

As the year winds down, a familiar pressure emerges. No, not tolerating relatives over the holidays; We’re talking about charitable giving.

While donating to your favorite cause should elicit feelings of joy, the process can be confusing and downright overwhelming. Over one million charities exist in the United States alone!

Especially when most Care2 members are motivated by multiple compelling causes, ranging from the environment to LGBTQ rights, choosing where your money goes can be a tough decision. Do you support a local nonprofit or an international NGO? Opt for faith-based charity or something independent? A well-known organization or a start-up struggling to get on its feet?

Assess Your Priorities 

Before making a donation, take time to reflect on the year and consider your priorities. Why are you donating? Were you moved by the devastation of the Nepal earthquake earlier this year? Did you participate in Black Lives Matter activism? Or perhaps a friend or family member was recently diagnosed with breast cancer. These sorts of personal connections can guide you to purposeful giving.

And be aware that just because you donate to a nonprofit dedicated to, say, human rights, doesn’t mean that you won’t also be helping other important causes like climate change and women’s education. While groups tend to maintain a focus to stand out in the crowd of other do-good organizations, most are not exclusive to one cause in practice. A teen arts program can combat gang violence and drug abuse, while also fostering creativity and career development.

Once you’ve narrowed down the sorts of issues you’d most like to target, consider your ideal outcome. If your passion lies in maternal health, would you like to see less childbirth mortality? Better sexual education programs? More economic opportunities for mothers? Less domestic violence? These are the sorts of difficult choices that accompany end-of-year giving.

Do Some Research

We’re all seeking to make the largest impact with our contribution, and that, for better or worse, requires some research. Now that you have a more specific idea of your goals, do a quick web search of potential recipients. Jot down names of nonprofits that emerge, and be sure to scroll through a few pages of hits–not all will have the know-how or resources to maximize their search engine optimization. Also check the news tab of your browser for up to date information about recent events that attracted positive or negative media attention.

Now that you have your short list, it’s time to delve into the operations of each organization. Read the mission statements and “About” sections of their sites. Maya Prabhu, head of philanthropy at the UK bank Coutts, tells the BBC the best question to ask yourself is, “Does their strategy seem clear to you and can you see any evidence of the impact of their work?”

Again, this can be a lot of work, so take advantage of the resources available to you. Websites like Charity Navigator, GuideStar, and BBB Wise Giving Alliance present detailed profiles on charities with ratings, data and breakdowns of finances. They’ll give you a solid idea of the transparency, effectiveness and accountability at each organization. If you prefer a more personalized approach with less number crunching, GreatNonprofits offers a platform for community-based reviews and endorsements of nonprofits. Browse by category or geographic location to find the charities that matter most to you.

One of the major strategies that experts suggest to narrow your search involves examining the amount of income that goes directly to programs versus administrative tasks or advertising. The common line of thought seems to be that the more money going to the charity’s “hands on” initiatives-whether that be medical research or home construction-the better.

Adopt an Alternative View

But some feel this sort of analysis falls short. The success and productivity of a charity cannot be reduced to the amount of money it does (or doesn’t spend). After all, big results can require big spending, points out Dan Pallota, founder of AIDS Ride, in his TED Talk. “We have two rulebooks-one for the nonprofit sector and one for the rest of the world …and it discriminates against the non-profit sector,” Pallota explains. He continues with his argument: “We have a visceral reaction to the idea that anyone would make very much money helping other people. Interestingly, we don’t have a visceral reaction to the notion that people would make a lot of money not helping other people.”

And while we love to hate “overhead,” Pallota poses the question, “who cares what the overhead is if these problems are actually getting solved?”

Remember the Basics

Whew. So there’s a lot to think about here. But just keep a few tips in mind, and you’ll be well on your way to giving thoughtfully and meaningfully.

-Avoid over the phone donations! Even if a charity appears reputable, the telemarketers making the call will inevitably end up with a portion of your donation. Instead, get in touch with the organization directly and only after you’ve completely reviewed their online presence.

-Confirm that your seemingly wonderful charity is, in fact, a nonprofit. The IRS Search for Charities tool enables you to easily search through its database for tax-exempt organizations.

-Read the news! Check out what people are saying about your nonprofit on Twitter and the rest of social media. Those fundraising brochures that wind up in your mailbox this time of year will certainly gloss over any recent controversies. If an organization is under investigation, it’s probably not a great time to hand over your money.

Consider Other Ways to Give

Feeling stifled by the traditional nonprofit mold? Break out of it! Crowdfunding, microlending and direct donations represent relatively new phenomena in the realm of giving.

Plain and simple, crowdfunding takes advantage of small donations from many people to get projects off the ground. These platforms lend themselves to a creativity and diversity that you won’t find elsewhere. IndiegogoCrowdrise and Experiment offer endless options for giving.

Microlending, in which an individual gives out a loan, rather than a bank, enables you to offer funds to entrepreneurs and small businesses all over the world, most without access to traditional banking systems. Sites like Kiva allow you to search through personal profiles of those seeking money to pay for college, hire additional employees, or buy bulk products for resale. Field partner organizations receive 100 percent of your loan and administer it to the borrower(s) you selected.

Direct donations are exactly what they sound like–putting funds right into the hands of those who need them. GiveDirectly, the first organization of its kind, gives cash transfers to impoverished Kenyans and Ugandans using electronic payments services. Joy Sun, the former chief operating officer of GiveDirectly, asks, “how good are we at allocating resources on behalf of the poor?” The answer appears to be, “not very.” And contrary to popular belief, recipients do not spend their funds on alcohol, tobacco or other “temptation goods.” Most often, they opt to purchase food or pay for medical and education expenses. Who would’ve thought.

Finally, remember that “giving back” does not have to take a monetary form. A great way to determine which causes are worthwhile is to actually get on the ground and volunteer your time. You’ll have the chance to interact with staff members and ask questions while gaining a behind the scenes peek into the inner workings and culture of the organization.

Photo Credit: Thinkstock

69 comments

Sue H
Sue H6 months ago

Helpful information, thanks.

SEND
Siyus Copetallus
Siyus Copetallus3 years ago

Thank you for sharing.

SEND
Sarah Hill
Sarah Hill3 years ago

We give to CBN because they do so much with the donations they receive-they dig wells for people & villages without clean water, they provide medical help, they provide disaster relief (and stay there until...), they build houses, provide ways for those in need to earn money, and the list goes on. We also give to Christians United for Israel for all their support for Israel.

SEND
Sherry Kohn
Sherry Kohn3 years ago

Many thanks to you !

SEND
Kathryn Irby
Past Member 3 years ago

"AARP Foundation" is a great charity for hunger of the elderly! Thanks for sharing.

SEND
Kathryn Irby
Past Member 3 years ago

Giving is for good gals and guys! Thanks for posting.

SEND
Cela V.
Cela V3 years ago

tyfs

SEND
caroline lord
caroline lord3 years ago

thanks

SEND
Kathryn Irby
Past Member 3 years ago

I love giving to charities! Thanks

SEND
DJ M.
DJ M3 years ago

as we're giving only donations in my family now, it's good to have this information

SEND