How to Find a Worthy Charity
‘Tis the Season of Giving.
Whether you prefer volunteering, dropping money in the bucket next to a Salvation Army bell ringer, or donating to charities, this time of year finds hearts and wallets open with kindness and generosity.
But, if you’ve decided to gift a charity with a donation, do you know how to find a worthy one?
Many people believe all charities work the same.
- You donate money
- They give all the money to the program they are funding
- Everyone is happy
Unfortunately, this is not true.
There are both charitable nonprofit entities and for-profit entities.
It’s essential to know the distinction.
A nonprofit charity organization must be recognized by the IRS under section 501(c)(3), “organized and operated exclusively for charitable purposes.”
A for-profit charity organization may fund a charitable mission, but it is still recognized as a profit-making corporation.
It’s essential to know what kind of organization you’re donating to and where your money is going.
The process of finding the best, as well as a legitimate charity, may seem daunting, which is why there are resources (charity watchdogs) to help navigate the over 1.5 million IRS-registered charities in the U.S.
One such resource is Charity Navigator. Their searchable database can assist in finding a nonprofit charity that matches your preferences.
However, if you want to take on the legwork – keep these things in mind.
Before donating to a charity, make sure you research it
- Check its mission statement
- It can usually be found on their website
- Why does the charity exist?
- What are its goals?
Where is the money being allocated? A reputable charity should donate at least 70% of the money it receives through donations to its programs.
- Administration or employees?
- Fundraising expenses?
Since public charities are registered as nonprofits, their annual report is available to view – and you definitely want to take advantage of this.
What have they accomplished?
- Are they able to show you examples of their results?
- Are they meeting their goals?
- What are other donors saying about them?
- Yes! Read customer (donor) reviews
- Do they keep in contact with you about their progress?
Communication is important
- Are they keeping you apprised of the charity’s success?
- Do they send a copy of their annual report?
- Did you receive a thank you for your donation?
Things to consider
- Are there hidden fees?
- Does the charity have tax-exempt status?
- Use a credit card on a secure website when making a donation to protect yourself
- Do not give personal and financial information over the phone, such as:
- Bank account numbers
- PIN numbers
- Social security number
- Birth certificate/birth date
- Address and phone number
- Stay away from wire transfers, prepaid debit cards, or gift cards
What’s a ‘soundalike’ charity?
- Be sure the name of the charity you want to donate to matches exactly
If you can’t find what you’re looking for, start your own fundraiser
- What are you passionate about?
- What are you willing to stand behind?
- What platform is the most used for starting your own fundraiser?
- Targets social media platforms
- Users can create their own website – usually for personal causes and life events
- It is a for-profit crowdfunding
Know that your generous gift is most appreciated. Every dollar helps make a difference. Donating to a charity is a wonderful way to make a positive impact – just make sure you do so wisely.