Sept. 27, 2021

8. Where to find charities and what to ask


Today's episode is about where to find charities and what to ask. Here's the letter:

How should I research a charity to decide if I want to give to them? Where do I look and what questions should I be asking myself?

Start by asking yourself your budget and your financial requirements.

For example, is it important to you that you claim tax benefits from your donation? Is that even realistic for you given the standard deductions? If you think you’ll be donating less than that threshold this year, that might free you up from having to worry about whether or not the charity is a 501c organization, which means that they have filed paperwork with the IRS and have agreed to comply with the various legal requirements involved in keeping up their tax exempt status.

There are some wonderful initiatives around our country that have not filed for 501c status. So you may have opened up even more options for yourself to find the people who are doing the work you are passionate about.

After you’ve figured out your budget and whether or not tax deductions are important to you, now it’s time for the fun part- thinking through your values and your priorities for the year.
I would encourage you to take some quiet time, pour yourself a warm beverage, maybe in the morning before your day starts, or in the evening if you get a moment to yourself, to reflect on the topics that really speak to you. When you read the news, which articles are the ones that you always read? When you read or listen to someone’s autobiography and they talk about the challenges they’ve faced, which ones really tug at you? What do you feel like are the most important, most overlooked types of help that are needed? Who is overlooked? These are some questions that start that brainstorming for you.

And these priorities can change over time as you change and as the world changes.

For you, it might be that you are committed to being a better ally to the people in your community. That can be an amazing way to think about your giving. And on this show, in addition to talking about donating, we also talk about your spending and investing. Being oriented around your local community is an amazing way to orient how you use your money in all 3 of these ways. You can do some google searches to find out what local initiatives are going on that need financial assistance in your city. Even if you’re not religious, you can connect with local religious institutions to find out what programs they know about. They tend to be connected to what’s going on locally.

If you’re somewhat new to giving, I would suggest picking two or three places to give this year and getting that experience. Maybe one small and one medium charity. Set up reminders on your calendar, or auto deductions from your banking account to send donations every month, or every quarter. I’ve seen people donate on their birthdays and I do think that’s great, but, for many of us, once a year isn’t enough frequency to make it a regular part of our practice. So I’d start with monthly or quarterly, and again, either set up reminders on your calendar or set up auto-deductions.

So, those are the 3 fundamental questions to ask yourself- 1) your budget 2) your priorities 3) your strategy of going wide versus deep.

The other part of your question was where to research information about charities. There are so many sites that are set up as charity evaluators and none of them are perfect. We'll talk about limitations in today's episode.

To receive a guide to help decide on your priorities, email the show at spenddonateinvest@gmail.com

To submit your letter to the show, email spenddonateinvest@gmail.com

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Transcript

Today's letter is about where to find charities and what to ask. Here's the letter:

How should I research a charity to decide if I want to give to them? Where do I look and what questions should I be asking myself?

This is such a great question and one that I think a lot of us can relate to. Most people give when they are asked, it’s a secret that fundraising professionals talk about. So, it isn’t necessarily that most people sit at home and think in a very planned way about where they want to donate. I think for a lot of people it is when their friends and family ask them to donate or a natural disaster happens or a humanitarian crisis of some sort pops up. And this is a great way to meet urgent needs, but I love this idea of sitting back and thinking more proactively about where you want to donate.

I’m going to start with the last part of your question- what should I be asking myself? Because that’s going to inform where you go to look for this information to research potential charities. What to ask yourself? First of all, what’s your budget? Second, what are your financial requirements?

Is it important to you that you claim tax benefits from your donation? You’ll have to look up tax information for your area and consult with a tax professional for your specific case, but  I have heard of people stacking their donations so that maybe they pile up that money and donate it every 3 years so they can reach that deduction threshold. Or every 5 years. Again, consult a tax professional.

But if you think you’ll be donating less than the threshold this year, that might free you up from having to worry about whether or not the charity is a 501c organization, which means that they have filed paperwork with the IRS and have agreed to comply with the various legal requirements involved in keeping up their tax exempt status.

There are some wonderful initiatives around our country that have not filed for 501c status. So you may have opened up even more options for yourself to find the people who are doing the work you are passionate about.

After you’ve figured out your budget and whether or not tax deductions are important to you, now it’s time for the fun part- thinking through your values and your priorities for the year.
I would encourage you to take some quiet time, pour yourself a warm beverage, maybe in the morning before your day starts, or in the evening if you get a moment to yourself, to reflect on the topics that really speak to you. When you read the news, which articles are the ones that you always read? When you read or listen to someone’s autobiography and they talk about the challenges they’ve faced, which ones really tug at you? What do you feel like are the most important, most overlooked types of help that are needed? What is overlooked? Who is overlooked? These are some questions that start that brainstorming for you.

And these priorities can change over time as you change and as the world changes. I’d encourage you to pick one or two things to start with. For example, I’ll speak for myself, one issue that I have never been able to stop thinking about is the access to menstrual products and how that can be a barrier to attending school, for many girls around the world. Maybe you have always been galvanized by LGBTQIA+ rights. Maybe you are like my friend who randomly got a job on skid row and has not been able to stop thinking about access to housing ever since.

Or for you, it might be that you are committed to being a better ally to the people in your community. That can be another amazing way to think about your giving. And on this show, in addition to talking about donating, we also talk about your spending and investing. Being oriented around your local community is an amazing way to orient how you use your money in all 3 of these ways. You can do some google searches to find out what local initiatives are going on that need financial assistance in your city. Even if you’re not religious, you can connect with local religious institutions to find out what programs they know about. They tend to be connected to what’s going on locally.

So far we’ve talked about deciding on a budget and your priorities.

The next question is to ask yourself if you would find it more motivating to go deep with one organization or to spread the love among a few different charities?

If you’re somewhat new to giving, I would suggest picking two or three places to give this year and getting that experience. Maybe one small and one medium charity. Set up reminders on your calendar, or auto deductions from your banking account to send donations every month, or every quarter. I’ve seen people donate on their birthdays and I do think that’s great, but, for many of us, once a year isn’t enough frequency to make it a regular part of our practice. So I’d start with monthly or quarterly, and again, either set up reminders on your calendar or set up auto-deductions. 

You’ll start to see how you feel. I am someone that likes to have flexibility to give to different needs that I might not have been thinking about at the beginning of the year when I’m setting my intentions. My partner is someone that likes to see the slow but steady building of contributions and how they can add up over the course of a year or multiple years. So, what we’ve done is to split our charitable giving so that a portion of it is automatically going to an organization month after month and the rest of the money is free for flexible donations on a monthly basis. That way, when a humanitarian crisis happens or a friend is raising money for something important, we are still building momentum with our donating but preserving some flexibility. If you’ve come up with other solutions, please do share them.

So, those are the 3 fundamental questions to ask yourself- 1) your budget 2) your priorities 3) your strategy of going wide versus deep.

The other part of your question was where to research information about charities. I have a lot of thoughts about what we ought to be measuring when we evaluate charities which I will save for another episode, because this one is already packing in a lot, but in terms of where to find info to help you decide whether to donate to an organization or not, here are some suggestions:

There are so many sites that are set up as charity evaluators and none of them are perfect. They are all going to be evaluated according to their criteria, not yours, so it can be a starting place to look at givewell, charity navigator, , but use these websites with an eyes wide open approach. Like picking a college, we’re not all looking for the same thing. How I like to use those sites is to find out some basic information like how old is the organization, who runs it, what is their annual budget. But there are some metrics that I don’t use, like the percentage of their money that go to administrative expenses or overhead. Sometimes I am curious to see if salary information for the people that run the organization is listed, but again, I can’t say that’s a metric that helps me decide or not decide. I like to also go to the charity’s website if they have one. If they publish an annual review or annual report or an annual letter from the leader of that group, I really love to read those. All organizations won’t have the budget to create these glossy end of year reports, but if they have it available, I love to read those. If they have community events where they need volunteers, that can be a great way to get to know an organization too, especially if you’re giving to local groups. So it’s a little bit of a combination of maybe looking at the charity evaluation websites plus the organization’s website plus their annual reports plus volunteering at their events, if you can.

I want to encourage you to avoid analysis paralysis and start by giving small while you continue to decide if you feel comfortable giving more of your money. Once you start donating to an organization, many of them will keep you in the loop as to what they were able to do with your money. That may help you feel comfortable to donate more money in the future. That can be part of your vetting approach.

I hope that was helpful. I created a guide to help decide on your priorities. You can get that by emailing the show at spenddonateinvest@gmail.com 

I’ve also been thinking about creating a guide on how to vet a charity before you donate, let me know if that would be helpful.