Charitable Donation Advice from Penny Powers: Donation Defender
You’ve been busy making money. Once you earn it, it’s time to spend it. You spend it on groceries, utilities, car payments, house payments, etc. You may even have some money you donate. And given all the time you’ve spent earning that money and spending that money, it’s tempting to just donate. After all, it’s not like you’ve got all this extra time you don’t know what to do with.
Can’t you just trust that the charity you’re donating to is going to make a big impact with your donation?
Trust is a beautiful thing. Trusting a charity is not. A charity is just like any other business. Some are great and amazing while others are, eh, not so bad, or even, god forbid, awful!
You MUST Research First!
If you’re donating without educating yourself about the charity or the problem you could be throwing your money down the toilet. I don’t know about you, but I don’t flush money down the toilet.
3 Risks of Donating Without Researching First
Below is a brief description of the dangers, but you can read in-depth examples on each one at this page.
It funds a program that doesn’t work and or has a small impact on the problem they are trying to fix. Or maybe the majority of your donation goes to pay the salaries of fund raisers.
A few high profile cases shows that charities, just like for-profit companies, can be subject to fraud and embezzlement. Even if the case isn’t an extreme criminal example, the charity can pay exorbitantly high non-program costs and salaries to its CEOs and fundraisers, which is a red flag to me that they are more interested in the business of collecting money than in the business of making an impact.
It Hurts People
The worst outcome is when a donation hurts the people it was intended to help. For example, funding an orphanage can cause orphans or donations of clothes can deprive local people of employment and make them dependent of outside aid.
The Research Shortcut
If you care about what your donation does, then you must understand the charity and the problem BEFORE you donate!
If you’re wondering how you’re going to do that with your busy schedule or if you’re wondering, “Where do I even look for this kind of information and what do I look for?”, then I have a suggestion for you. (Because that’s what I do. I’m the Donation Defender, and I want your dollars to work as hard for the world as you worked to get them.)
Don’t go it alone!
Create your donation team and together you share the work of researching. Our virtual giving circles here are that donation team. The donation committee thoroughly researches the charity before we donate so we can make an informed choice on whether or not we really want to donate to that charity.
We have educational components at our meetings so that our understanding of the problem deepens and we can direct our donations to organizations and programs that are making a big impact.
A giving circle around your favorite cause can help you make smart donations in very little time. In fact, there are 10 reasons why donating through a giving circle is a great idea.
I’ve written a few other blog posts that will help you create your own research strategy.