Be wise during this season of giving
- 11/27/09
- Categorized in: Lifestyle
Muslims and Jews do it—so do Christians, Buddhists, Baha’is and other faith groups. Giving to the least fortunate is a foundational principle of most religions. With the season for giving under way, people from religious communities across the spectrum are beginning to open their hearts and wallets.
These economic hard times have left many families in dire need and have spurred an explosion of new charities eager to accept donations from generous givers. Experts suggest a number of ways to avoid scams and to give wisely and effectively.
First and foremost, be an informed giver. When approached by a charity, ask many questions to ensure that one’s financial support goes to an organization and activity that one believes in. Also, find out what percentage of donations actually goes to charity activities and how much to cover the organization’s administrative expenses.
According to the Federal Trade Commission, brochures and other written information should include the name, address, telephone number of the organization, information about the charity’s mission, how it uses donations and proof that contributions are tax deductible.
The FTC notes that a number of charities have sprung up in recent years in response to natural disasters (like Hurricane Katrina) and the economic downturn. Many are well-meaning but lack the infrastructure to succeed. Consequently, they often depend on solicitors or fundraisers to bring in donations for the organization. This situation has created an industry for unscrupulous individuals to commit fraud.
“Give directly to the charity, not to paid solicitors who contact you on the charity’s behalf,” says the agency. “Ask whether the person is a paid fundraiser and, if so, what percentage of your donation goes to the charity [and how much he keeps]. If you’re not comfortable with the amount, you may consider donating to a different organization or sending your gift directly to the charity.”
Experts warn holiday givers to be wary of charities with similar names as well-known organizations. Scam artists often use names that sound like respected and established charities to steal money from generous donors.
Red flags should go up in one’s mind if a charity organization offers to pick up your donation. “A legitimate charity will have an official address where you can mail your donation,” the agency notes. And don’t give cash. For security reasons and tax records, make donations by check. Also, write down the official name of the charity on your check for record-keeping purposes.
Make sure your donation is tax deductible. Some organizations use terms like “tax I.D. number” or “keep this receipt for your records” to suggest they are tax-exempt charities when they are not.
Rather than giving money, many experts suggest volunteering one’s time and personal skills—which could be just as valuable as money to most nonprofit charity organizations.
When in doubt about a charity, consult the Better Business Bureau’s Wise Giving Alliance. Not only does it help donors to make informed giving decisions, but it also promotes standards of conduct among organizations that solicit contributions from the public.
The FTC suggests that holiday givers check the bureau’s Wise Giving Alliance Web site to help them make an informed decision. The site also rates charities. Keep in mind, though, that many legitimate but small charities may not be included on the bureau’s and other Web sites.
Suggested Web sites to research charities: