5 things to keep in mind before donating to charity
A Salvation Army donation.
Eileen Heisman is the CEO of National Philanthropic Trust and an ambassador for #givingtuesday, and joins the show to give a few tips for getting the most out of your charitable donations this holiday season.
1. Identify what is important to you and do some research: Look for a charity with a mission statement you believe in and a cause that means something to you. See if the organization has a solid background, good leadership and has produced results. If you are interested in a charity's balance sheet, GuideStar publishes US charity's Form 990. And don't be shy - contact the executive director or staff to ask about the organization's short and long-term plan for how they will meet their mission.
2. Determine your impact: It is nearly impossible for an individual to make a smaller donation directly to an international charity because of legal, tax and financial complexities - some created to protect US donors. Look for international charities that have U.S.-based "Friends of" chapters that can accept your donation. Or give to U.S. charities that have an international mission. For example, in the wake of Typhoon Haiyan, Doctors Without Borders, Save the Children and Oxfam America (all based in the U.S.) raised millions for relief efforts and already had a presence in the Philippines. Organizations that are on the ground before the disaster are the best equipped to assess the most critical needs in the aftermath and use your donation impactfully.
3. Numbers are important, but they're not everything: It is important to remember that the balance sheet alone does not paint the full picture of a charity and its work. From the number of people reached to the dollars raised, impact can be measured in a number of ways. How does your charity support define success? What resources does it need to succeed? If serving more people is part of their growth, then hiring more staff and training more volunteers may be a logical increase in overhead expenses.
4. Be strategic, have a vision and stay loyal: Larger gifts to fewer charities will have more impact, whether you are donating $100 or $1,000. Also, consider what type of gift you're giving: cash and checks are popular, but more and more often appreciated stock, real estate or even art can potentially provide a higher dollar value to the charity and a better tax deduction for you. A charity's cost of reaching a new donor is much higher than keeping someone who has already made a donation. To maximize your donation, try staying with a charity for a few years - three to five years. In short, be a donor your charity can rely on.
5. Check back: Leverage social media and set a calendar a reminder to check back with your favorite charitable organizations next summer. What was the impact of your gift? Is your charity meeting its goals? Do you feel there is transparency at the organization? If your charity is doing a great job, you may want to increase your gift. If your charity didn't meet its goals, ask direct questions to the executive director; for example, was there a change in leadership? There could be a good reason-or maybe not. The staff should have reasonable, detailed answers to your questions. Use this mid-year information to help guide your donation strategy for the next Giving Season, December 2014.