How can your family become a smart donor family? Here are some simple steps to follow.
1. Make an annual giving plan and identify a cause or causes you and/or your family would like to support. This allows you to stay within budget and be proactive in your choice of charities - instead of reactive to an organization’s campaign (which may not perfectly align with your philanthropic interests).
2. Do research to identify organizations that match the interests of your family. Decide if you want to focus locally, nationally or internationally. Take the time to ensure that the organization(s) you are interested in supporting provide the services and programs you expect.
3. Do your due diligence. Ideally, you are able to answer the following questions before donating to an organization:
Is the charity you selected using their financial resources efficiently? Legally, a non-profit organization cannot spend more than 35% on overhead expenses and must spend at least 65% on program costs.
Do they disclose their sources and uses of funding (is there transparency)?
Is there evidence of impact?
Do you trust the management of the charity to use your donation as you intended?
4. Call the charity and request material, such as their annual report to learn more about how the organization operates. Ask them about their mission or vision statement. If applicable ask for a tour of their facility, program, etc. Search online and check for complaints against the organization. Review their records on Charity Navigator, Charity Watch, National Association of State Charity Officials, Better Business Bureau’s Wise Giving Alliance, or GuideStar. Look into their finances and make sure you are comfortable with how they use or distribute donations. Check the IRS webpage to confirm the organization is eligible for tax deductible contributions.
5. After you have chosen the organization(s) you want to support, you will need to decide will you a) give an “unrestricted” donation (the organization decides how the money is used) or b) “ear mark” the donation for something specific within the organization? In order to maintain a record for tax purposes, it is best to donate via check or credit card.
Be wary of giving money to a phone solicitor representing an organization you are not already affiliated with, and even if they are, confirm that the call is legitimate. Sometimes the scammers will thank you for a pledge that you never made in order to confuse you and get you to donate immediately.
Avoid donating to a charity, fundraiser or not for profit organization that:
Won’t provide details about the organization (their mission, how donations are used, general information on cost structure, etc);
Cannot provide proof of their charity status or that your donation is tax deductible;
Asks for cash, wire transfer, or bank account number, or other personal information; or
Offers to send a courier or overnight delivery service to collect your donation or tries to pressure you to donate immediately.
Still not sure who to donate to?
Given that we just came out of an election year, many donors who normally donate to charities may have chosen to donate to candidate campaigns instead. As a result, there are many organizations that were counting on certain funding but didn’t receive it. Research which organizations did not meet their funding expectations and see if those are ones you and your family would like to assist.
Charity Navigator: http://www.charitynavigator.org/
Charity Watch: https://www.charitywatch.org/home
National Association of State Charity Officials: http://www.nasconet.org/about/
Better Business Bureau’s Wise Giving Alliance: http://www.give.org/
Best of luck finding your match!
Anupa Wijaya, MS, is the founder and Executive Director of The Bag Project, an organization that provides emergency bags for children in crisis. She graduated from University of Michigan with a BA in Psychology. From the Harvard School of Public Health she received an MS in Health & Social Behavior with a concentration in Women's Health. Anupa was previously a Director of various programs at Safe Horizon (NY, NY), including the Anti-Trafficking program and a program for survivors of war torture and refugee trauma. Anupa also spearheaded Safe Horizon’s reorganization of their Hotlines program, as a consultant. Prior to consulting at Safe Horizon, Anupa was the Assistant Director for the Illinois Violence Prevention Authority (Chicago, IL). Anupa began her post-graduate career as the Education & Outreach Coordinator for the AIDS Clinic at New York Presbyterian Hospital (NY, NY). Anupa lives in Princeton, NJ with her two children and her husband. For more information on The Bag Project, please visit: www.thebagproject.org.