If you’re planning to make charitable donations, you’ll want to know more about the charities you support. Here’s how to research philanthropic organizations to ensure your money goes toward causes you care about.
Many Grownups want to make charitable donations, but aren’t sure where to start. There are thousands of organizations to choose from, and stories about corruption can deter even the most generous. Fortunately, a few simple steps can help you identify groups that will manage your contributions well.
I’ve approached selecting a charity similarly to hiring a professional. Familiar strategies like seeking recommendations, reading reviews, and visiting the organization can help you evaluate a group. Gaining first-hand experience through volunteering can also offer insight about whether a group is a good match.
Seek Personal Recommendations
So I’m ready to research a charity—but which one?
First, consider the type of work you’d like to support. Are you interested in helping children, animals, medical research, or another special cause? Or maybe you’re open to a variety of charitable works.
Next, find out whether someone you know can point you in the right direction. If I were looking for a new dentist, I’d first ask friends for recommendations. The same approach is the perfect starting point for picking a charity.
Does a friend or family member contribute to an organization? Some people are quiet about their philanthropy. You may need to ask the people in your life directly if they could recommend a nonprofit. Perhaps they’ve already researched the group and could share the information with you.
Do you know anyone who works or volunteers at a nonprofit involved in charitable work? They likely know the ins and outs of the organization and can answer your questions about how funds are used. I learned more about one organization I donate to from a friend who works there. She helped me understand the type of work they do, as well as how they manage revenue.
I’ve had a personal connection with every charity I’ve ever given to. Friends who worked or volunteered with the group explained why they felt it was worth supporting. Hearing insider information from people I trusted was a valuable resource. Without their testimony, I may not have felt comfortable giving away money.
If you don’t turn up any ideas from your personal network, try to make a list of charities you’ve heard of. Have you or someone you know ever benefited from a nonprofit’s programs? You might include groups working in your city since those will be easier to look into. Still stumped? Check out the charity rating websites below.
Check Charity-Rating Websites
While personal recommendations are a helpful starting point, I prefer to investigate further before I start signing checks. Whether you have a group in mind or are still brainstorming, you can learn more through charity-rating websites. Charity Navigator, GuideStar, and The Wise Giving Alliance report on the fiscal effectiveness of charities. Reports include details like the percent of their funding that goes to programs, administration, and fundraising. You can also read about fiscal policies, total revenue, and the CEO’s compensation. Some also include donor reviews and descriptions of the mission and programs.
It only takes a few minutes to check a charity’s ratings online. Just remember that a standardized rating system may not tell the whole story. Some smaller groups don’t appear on these sites, but may still be reputable options. Others might not achieve the highest financial efficiency ratings because of the nature of their work. If nothing else, the online report can help you form questions for your next stage of exploration.
Volunteer or Visit
Ratings are helpful, but gaining first-hand experience with the charitable group adds another dimension of understanding. Volunteering with or touring a charity is perhaps the best way to find out whether it’s a worthy destination for your donations. Expect a tour or interview to take just an hour or two, while volunteering will be a bigger time commitment.
Seeing what the organization actually does, learning about its use of resources, and making personal connections can go a long way toward building trust. My husband and I traveled (separately) to volunteer with an international ministry we donate to, and learned more from our trip than we ever could from reading field updates.
Checking out the charity was not the primary purpose of our trip, but we gained a depth of insight about the group. We met the child we sponsor and saw the type of life he’d have without our support and the provisions he now enjoys. We also met his child care providers, toured children’s homes, and met the president of the organization. While we could never claim to be 100 percent certain about how every dollar is used, we walked away confident about supporting this group.
Of course, not everyone needs to see the work up close. Do you know someone who has observed a charity’s work? You might interview the person to get an idea of whether that organization is a suitable match. One of our friends visited an international charity and spoke highly of their children’s programs. We signed up for a child sponsorship after checking it out online.
Some organizations may not accept volunteers because of the nature of their service. If this is the case, you may be able to tour their office or observe work in the field. For other groups, it might be more appropriate to ask questions by phone or email. Throughout your research process, it helps to communicate respect and gratitude for the charity’s work.
Give with Confidence
Choosing a charity can feel daunting, but it’s well worth the effort. I view charitable giving as a type of investment in the lives of others and my impact on the world. Through this lens, a little due diligence and even volunteering only make sense. Hands-on experience can lead to a lifelong connection with a cause you feel good about supporting. And who knows? Maybe you’ll be able to recommend a charity to others in the future.
Kalie Brooks’ blog Pretend to be Poor covers financial planning and living on the cheap.
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