Think Before You Give

20th Sep 2010

Philanthropic giving is important to the welfare of the world, but it is often difficult to determine where to give your money too. There are so many good causes out there, but sometimes it is difficult to determine where a donation will do the most good. Although what philanthropic cause you want to support is up to your own preferences, giving to a legitimate and efficient charity will make your dollar go further to improve the world.

Firstly, it is important to know the charity you’re donating to. Requesting literature about a company will not only give you more information about their mission, but it is a good sign of a legitimate charity. Honest charities will want to be as open as possible about their finances and practices.

Secondly, it is important to figure out what percentage of your donation is actually going to the cause and not to administrative costs or fundraising. Depending on the charity, 60 to 80 percent of your donation should be going straight into the program’s charitable services.

Finally, check out the charity’s ratings on watchdog sites like or These sites rank companies based on many different factors and contain relevant information you may want to consider before donating

Two final things to think about before writing that check…

It is also important to know the difference between a tax exempt charity and a tax-deductible contribution, and that they do not always come hand in hand. A tax-exempt charity means that the charity doesn’t have to pay taxes, while tax-deductible contributions mean that you can deduct contributions from your income taxes. Make sure your money goes as far as it can by making sure that your contribution is tax deductible BEFORE donating.

Also, think twice about giving to charities that send you a gift via the mail. These charities often have huge overheads (think about the cost to mail out thousands of key chains or calendars), which takes away from the money going to their cause.

So think before you give, and with the same dollar amount you can make a bigger difference in whichever cause you choose to donate to.