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Advice & More September 2017

Targeted Philanthropy: Support Causes That Align with Your Values and Priorities

By Sandy Nelson

When deciding where to direct your financial giving, consider how effectively the organization will use your gift and what matters most to you.

Judging by the numbers, Americans are generous people. The Giving Institute reports that charitable donations exceeded $358 billion in 2014 — more than in any of the peak years before the recession.

If your budget has room for philanthropy, you’ll find no shortage of potential causes and organizations to support. The tone of most fundraising solicitations is urgent, and it can be hard to decide where the need is most pressing.

You can take a scattershot approach and give directly to a few groups that provide services you consider important, whether it’s hospice care, sheltering homeless and abused animals, or conducting research into breakthrough medical treatments. Or you can delegate the distribution of funds to an organization like United Way.

But you don’t need to be affluent to help people meet their basic needs for food, clothing and shelter. If you have time or energy to spare, most nonprofits train volunteers. Local food banks accept nonperishable food, shelters distribute donated clothing and home furnishings, and Habitat for Humanity relies on volunteers to help families build their own homes.

When deciding where to direct your financial giving, consider how effectively the organization will use your gift and what matters most to you.

  • Research the target organization’s mission and consider how well it aligns with your own passions and priorities. GuideStar offers an online database at www.GuideStar.org with information about the mission and performance of nearly 2 million U.S. charities and nonprofits, including some that operate locally.

  • Ask for a copy of the group’s Internal Revenue Service Form 990 and see how much of the money it raises goes to administrative and fundraising costs and CEO salaries, and how much goes directly to programs and services. According to Charity Navigator (www.charitynavigator.org), “The most efficient charities spend at least 75 percent of their budgets on programs and services, with the remaining 25 percent spent on administrative and fundraising costs.” It urges donors to favor groups with “reasonable” CEO compensation — about 3 percent of expenses.

  • Donations that attract matching funds magnify the impact of your gift, so ask if your target organization has community partners pledged to match financial contributions. In this way, even a modest donation can snowball into something significant.

  • People happily clear their cupboards and closets of food, clothing and toys during special drives because they assume these are what disadvantaged people need most. While relief organizations appreciate such generous gestures and often ask for in-kind donations in emergencies, cash donations allow the organization to more efficiently direct help where it’s most essential.

  • Giving locally lets you see the results of your gift up close and circulates more money and resources in your own community. Ask if your donation goes to a national organization or stays at home solving local problems.