1. Charities that spend a lot of their money on administration and advertising instead of delivering services don’t deserve your support.
If you hear ads for a “good cause” constantly on radio you’re right to wonder how much money actually goes to the cause and how much goes to fundraising. Too often a “charity” can get IRS certification but the money collected goes to salaries or other payments to the people who run the organization.
Unfortunately, there are scammers everywhere. A whole set of fraudsters and insincere organizers focus on preying on people’s charitable impulses. Sometimes the bad guys set up completely bogus websites and say that money donated will go to helping Afghan refugees, for example. In fact, the organization the website touts really doesn’t exist and the site is a complete criminal fraud. More often, the organizers create a charitable shell that passes IRS muster, but they pay themselves and their cohorts most of the money donated.
Before you give to an organization you have only heard about in an advertisement, check out the recipient organization on Charity Navigator.
That site lets you check the reputation of the organization you’re thinking of giving money to and find out how it rates in delivering service, transparency of its governance, financial controls, and other indicators of trustworthiness.
Three- and four-star charities are good places to give your money, we think. Avoid “charities” that are not listed or those with lower star ratings.