Donating Your Hard Earned Money To Charity: How To Make Sure It's A Good Cause

Last night, I read a very disturbing article on CNN that I wanted to make sure everyone would know about. If you read any of my other articles, you know that I am very frugal and enjoy every penny of my hard earning income. But when it comes to charity, I try to be as philanthropic as possible. In particular I try to donate to veterans organizations, as well as a few other local charities when ever possible. So back to the article. Apparently the National Disabled Veterans Foundation has bilked donors out of almost $60 million dollars! When it comes to actually getting donations into the hands of those in need, there has been a history of shady tactics and a track record of useless assistance they have attempted to provide. Personally I find this despicable, that a group is squandering money that was given with the intent to assist our fallen heroes.

So what can be done about this? Odds are, this "charity" will never be brought to justice, but there are a few things that can be done to prevent a similar backlash in the future:

1. Do your research! - As a potential charity donor, it really is up to you to decide where your hard earned pennies will go. I realize that people probably thought that their money was going to wonder veterans so how can you tell if the target of your benevolence is legitimate? In the links section there are links to Charity Watch, as well as Charity Navigator that can help you determine the legitimacy of a particular organization. Let's face it, almost anyone can form a non profit group, but that doesn't mean that you aren't lining the pockets of a highly paid CEO. I'm a big fan of the "Lists" on Charity Navigator. Be sure to checkout their list of 10 Charities with low paid CEOs. It will open your eyes!
2. Never Give Via Unsolicited Methods - Usually around Christmas time I hear about other groups making telephone solicitations on behalf of numerous organizations. If you have no relationship with a group and they simply call you up out of the blue, do not give to anyone calling you on the phone! A few years ago, there was a huge call center in Sanford Florida that was calling "On Behalf of Florida State Troopers" to raise money to purchase Teddy Bears for the troopers to give out to children who had been traumatized, and I thought this was a great cause. When I was pressed for a credit card number, I knew something was up. I requested more information by mail, and even said that I would purchase a bear locally, but I was ultimately hung up on. It turns out this call center employed known convicted felons, and only a tiny percent of actual donations went to the State Troopers. Oh and by the way, NEVER, EVER give money to unsolicited groups asking for money via email. It's guaranteed to be a scam
3. Give Locally - Yes I know that TV commercials for Feed The Children are heart breaking, but will you really get a monthly update from a small child you are whelping to feed in Nigeria? Even if a fraction of the money actually goes to children over seas, odds are they are just raising the next generation of 451 Scammers anyway.. Instead of feeding children overseas, why not give locally to a food bank and help needy children within your own community. The benefits are greater, and in many cases you can actually purchase food donations from the store and drop them off at locations around town instead of donating actual cash that has to potential for miss use.
4. Ask Your Tax Preparer - Just a quick thought on this one, but ask the person who does your taxes for advice on how to identity a great cause. Odds are they have been asked before, and they may even know of local based charities that can assist. Another added benefit is that they will probably point you in the right direction in regards to receiving tax benefits from your donation. They can generally advise how much you can lend to receive the maximum tax deductions.
5. Donate Items - Donating lightly used items to thrift shops and other local charities is another great way to ensure your money won't actually be spent on something frivolous. Sure you have no control over who buys your stuff, but you also get a tax break and the benefit of cleaning up your humble abode. Beware of large chains though. For example, our local "Goodwill" district actually accepts donations at our local Thrift Store, but they tend to send the "good" items to another location. Not everything donated at our location ends up in our local community. Be sure to ask if they are associated with any other locations and be straight forward, with the staff. Ask them how your donations will help the local community.
6. Volunteer - This just might be THE BEST way to make a donation. I personally don't think that your time is tax deductible or anything, but if you really just want to help out then volunteer your time. Because you personally wouldn't do anything that you know is wrong or knowingly do anything to defraud your neighbors, donating time not only helps out charities but also allows you to see the benefits first hand of your actions. Driving by a home that you helped build for Habitat for Humanity would be a great feeling, and a constant reminder of the hard work they you have put in.

With these few suggestions, hopefully you'll ensure that your donations will be in the right hands to help the came that you want. Instead of letting someone else determine where your money will go, become active in the community, and seize opportunities to give back. There are multiple benefits, and besides, it's just the right thing to do.