Charitable Giving Guide

We have mentioned in previous blogs of how holiday gift-giving can get a little crazy with all of the shopping for material things, that the recipient may or may not even want. I remember times in the past where I walked into a mall with a list of names, and would just make random purchases, just to cross the names off, one by one, feeling complete when the list was done. I did not feel fulfilled, nor pleased with the gifts that I was giving, I said I felt complete, meaning, my OCD of checking off lists kicks in, and that makes me feel in control. I rarely got that heartwarming feel, of actually putting thought or love into a gift, because I was so consumed with my budget, making a deadline, and just getting something to hand-off, meanwhile, contributing to more items that would undoubtedly end up in a landfill at some point.

When you’re struggling for what to give someone, we have some recommendations here, but we want to reiterate that a donation in someone’s name is a lovely gift to offer. It is such a wonderful gift, not only for the person you are naming in the donation, but also for the non-profit organization in which you are contributing. Throughout our blog, we’ve talked at great length about minimalist gift receiving and perhaps the ultimate example of this is charitable giving.

I recall the sweetest gesture of a friend who once gave me the gift of a donation in my name to an animal shelter that was desperate for financial assistance to build a facility that would inevitably make their shelter a non-kill shelter.  To this day, it is one of the best gifts I have received, especially, because within a year of receiving it, that shelter did, indeed, become a non-kill shelter.

Even if you do not have the financial resources to donate a large amount, even a small donation can help. Not only does every single penny count, but when you donate, it helps inspire others to donate. Of course, volunteerism is also welcomed by many non-profits, and you can also do that in someone’s name. While volunteering, ask the organization if they can provide a letter stating that you contributed X amount of hours, the time’s impact, and that you volunteered in the recipient’s name.

There may be other reasons that inspire charitable giving, like it being the end of the year, and you want to maximize your tax deductions for this year. No matter the reason, your donation helps either way. In fact, many organizations depend on year-end giving, especially donations in December, as the bulk of their financial income for the year.

We always encourage supporting local organizations, but supporting on a national, or international level is always welcomed. Often, local, and smaller organizations need more assistance than their larger counterparts. Here are some other tips in how to vet the organizations in which you choose to give:

  • Make sure its mission aligns with yours, or with your recipient. Do they have a proven track record for making an impact? This should be very apparent on the organization’s website or in their marketing materials. You want to know where your money goes, and/or how it is being used.
  • Evaluate transparency. Look for the groups that report back to you on their progress. Transparency is important. If a charity doesn’t want to share what it’s doing, that’s a big red flag.
  • Check the leadership. Do a bit of research about a charity’s executives, i.e. their experience, what motivates him/her. If the charity doesn’t have any staff information available or the information on leadership is sparse, that should give you pause. Plus, you want to make sure that most of the donations do not go to the executive’s salary.
  • We also recommend a few websites for vetting your charity
    • Charity Navigator: Evaluates organizations across broad criteria including IRS filings, revenue, how long it has been operating, fundraising and administrative expenses.
    • GuideStar: Find out a charity’s data and information — including IRS documents and annual reports — when you search through GuideStar.
    • CharityWatch: This charity watchdog lets you sort by popularity, compensation, and other metrics. It also includes information on “red flags” such as a history of unethical practices, wasteful spending, or investigations into the organization.

Before undertaking any large giving strategies, you should consult your legal, tax, or financial advisor. For most donations, in the guise of gift-giving this season, we think you will feel a sense of contentment, feel heart warmed, and better about your gift-giving decision.

Let us know what you think!