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Keep Check on Your Heart and Donate with Your Head

Giving to a well-deserved charity can be one of the best things you could ever do with your money. However, when it comes to giving to charities, it pays to give smart. With so many reputable charities that are truly in need of financial assistance, the last thing you want to do is give money to a charity that is misusing funds or simply not effective. So how can you make sure your charity is truly worthy? Here are a few smart tips for keeping a check on your heart and donating with your head.

Get to know your charity. The most important thing you can do before giving is to do some real research before you start giving. Read up everything you can get your hands on regarding your potential charity. Treat it like any other major purchase: a new television set, a new computer, or even a cell phone plan, since giving to charity often also follows a periodical schedule of giving. There are many helpful web sites that provide a lot useful rating information on over a million non-profit groups. Most of these are free and easy to use, and some even provide user ratings and thoughts about giving to specific charity and non-profit groups.

When in doubt, ask for Form 990. What is Form 990? Form 990 is the form that all legitimate charities have that details all of their finances. If you are in doubt about your potential charity, ask them to provide you with a copy their Form 990 form. All legitimate charity organizations and non-profit groups are required to provide this information to prospective donators.

Consider what is really important to you. This is perhaps the best piece of advice to take to heart when considering who to donate to. What causes really move you? What bothers you most? What problems are you most passionate about finding solutions for? Even though you cannot singlehandedly solve the problem of world hunger, you can certainly make a big difference in at least one person’s life. And this alone can be the most rewarding. So think about what really moves you. Do you wish all children had an equal shot at a good education? Do you worry about animal abuse and testing? Is there a health issue that you are passionate about? Giving to charities allows you to put your money where your heart is.

Calculate administrative costs. Although your heart may lead you one way, don’t let your mind escape you when it comes to choosing a charity. Look at the cold hard numbers. Is your charity up to snuff? A good guideline is: at least 65 percent of the money that you donate to your charity should go directly to works. Any more than this percentage and the charity may be spending too much money on administrative costs or fundraising.

Focus your giving to one cause. Instead of donating a few dollars here and there, research has shown that your dollars will go longer if you focus on one charity. Cutting a bigger check for one or two causes means that your money will go farther in the long run. Research has shown that giving smaller dollar donations usually means the money will be used for administrative costs.

Avoid giving to charities that solicit over the phone, as well as cash charities. The cause may seem wonderful and worthy and you may be moved to give, but resist the urge if you are being solicited over the phone. There is simply no way to gauge the true legitimacy of a charitable organization over the phone. Also, most well known charities and non-profits do not solicit over the phone. The same advice goes for cash donation jars that you may run into while shopping. Save those dollars for a charity you can research at your leisure.