Making the Most Out of Your Charitable Contributions

4 min read

November 28, 2017

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If you’re feeling generous after an enjoyable pride season, you’re not alone. Many LGBT-focused organizations rely on Pride season and the good will it generates to bolster fundraising for their programs. This year, too, the anniversary of the Pulse nightclub shooting in Orlando has elicited an outpouring of support both in terms of money and time.

This surge of giving shows us that good still exists in the world even in times of great despair. The generosity also reminds me of the importance of carving out a portion of your spending for giving, not just in a time of tragedy but on a continuing basis. I suggest three central questions when determining how to get the most out of your charitable giving.

Why Give?

To me, this question is the most important. When Ben and I first started to give to charity on a regular basis, I really wanted to know the rationale for giving. It sounds like a strange question, but I wanted to make sure that I gave “for the right reasons.”

I ended up asking a lot of people in my life — family, friends, coworkers — why they gave to charity. Naturally, I got a lot of different answers. Some people give because their parents always have, others give because their religion asks them to, and still others because they feel the need to help.

As I was determining my own reasons for giving, the rationale that rang most true was giving to provide opportunities for those around me. I have benefited from many caring people who have given me tools and opportunities to improve my life. I want to pay that generosity forward to those around me. So whether it’s feeding the poor, funding AIDS research or fighting for marriage equality, I give to empower others. And to me, that’s money well spent.

Your answer may be different. To find it, don’t just think in abstractions. Write down your thoughts, ask people around you and take the time to really understand why giving is important to you.

Where to Give?

This question is tricky because there are sooooo many charities. And especially in the wake of tragedies, con artists often prey on our generous impulses, so they can profit from horrific events. Even when there’s no outright fraud, even legitimate charities may waste or mismanage funds.

You should start by choosing a cause you feel passionate about. I chose three. One was money related (modestneeds.org), one food related (chicagosfoodbanks.org), and one LGBTQ related (www.hrc.org).

After choosing the charities, I researched each organization on the Charity Navigator website. The site evaluates and rates different charities. It also provides in depth analysis of the charity’s budget, so you know exactly how the organization spends the money you donate.

You can also check out the IRS Exempt Organization Select Check site for eligible charities. I eventually narrowed my choice to the Human Rights Campaign because it’s an organization that spends its money efficiently and benefits a large amount of people.

Again, writing down these answers and discussing with others will help make this process a lot easier for you. But don’t forget to do your own research. If you’re looking for LGBT-focused charities, you can find a list here.

How Much to Give?

Next you have to decide how much you want to give. When I was starting out, I thought there must be some kind of standard percentage that most people donated. I’d take that number and build it into my budget. Easy, right?

Well, no. I looked to the web and asked my friends and family. And again, I got a wide variety of answers: some people gave 1% of their gross income, others 10% of their net and others just gave sporadically. Even our government leaders vary widely. According to the Obamas’ 2015 tax returns, they gave almost 14.7% of their adjusted gross income to charity versus 1.8% for the Bidens. (Remember how much fun it was when you could see the President’s tax returns?)

Since I couldn’t find a standard amount of giving, I started with how much I could afford while still meeting my living expenses and savings goals. From there, I adjusted my other expenses to meet an amount I considered reasonable for charitable giving.

You will have to find what works with your budget. It will likely vary from year-to-year, given what budgeting goals you focus on. I suggest even starting with something small ($5 a month?) just to get into the habit of giving.

Other Best Practices

When you give, you should employ a few other best practices:

Don’t give personal information: A charity will never ask for personal information like your Social Security Number or passwords to online accounts. Avoid any solicitations asking for information of that sort.
Don’t give or send cash: For security and tax record purposes, you need to have a paper trail of how you gave your gift and who you gave it to. Checks and credit card receipts provide good documentation of your gifts.
Pay close attention the name of the charity: Bogus web sites sometimes solicit funds for victims of a recent tragedy by mimicking the name and sites of legitimate charities. Make sure you’re giving to the right organization.
Concentrate your giving: Once you have found the charity that you like, make a significant commitment. Giving your support to one or two organizations allows you to make more of an impact — and provides the charity with a greater opportunity to make substantive change.

Giving to charity is always going to be a personal endeavor, but it shouldn’t be just a whim. If you really focus your giving — carefully considering why, where, and how much to give — your donations will have more impact. You’ll increase your own personal satisfaction in giving and, at the same time, serve your cause more effectively.

Do you give to charity? If so, which one(s)? Let me know at the links below.