What is the biggest mistake that people make when donating to charity?
Not doing enough background research about the organization. It is important that donors understand and believe in the organization’s mission, vision, and values, and believe that the organization’s current work – its programs, services, and activities – will make an important difference in people’s lives. Do not assume that if a nonprofit has a slick website or an awesome and entertaining social media presence that they are necessarily making an impact.
What red flags should people look for before donating money to a charitable organization?
The most important red flag is a lack of information about what the organization is currently doing to achieve its mission. If it is unclear to you how the organization makes a difference in people’s lives, you should think carefully about donating. I do not think nonprofits need to “prove” they have made an impact to deserve support. But steer clear of dubious claims.
What is your favorite charity and why? // Why should someone donate to your charity?
That is a tough one to answer as there are several! One here in the U.S. is the Community Empowerment Fund in Chapel Hill and Durham, NC. They are a scrappy grassroots organization that offers very practical and tangible help for lower-income people and they do a great job of embracing diversity, equity, and inclusion, such as directly involving lower-income people in important organizational decisions. Outside the U.S., it’s Foundation Enfant Jesus, a faith-inspired NGO that provides a holistic range of services and supports (education, health care, women’s empowerment, community development, microenterprise) to lift families and communities out of severe poverty in rural areas of Haiti. The thing I appreciate about both of these organizations is that they are very grassroots – they do so much with so little as they do not have access to the grants, donors, contracts, and corporate sponsorships that larger “name brand” nonprofits and NGOs enjoy.
Also, as a huge music lover, I have to offer a shout-out to KEXP.org in Seattle. I am an “Amplifier” with KEXP because not only do they offer an incredible range of music, live performances, podcasts, and more, they promote community and mental health through music – something we all need during these challenging times. They have also recently made some significant changes inside their organization to better promote diversity, equity, and inclusion – it is not just a slogan for them.
What are the biggest challenges facing US-based charities in the current economic environment?
It’s the same fundamental challenge nonprofits faced during the Great Recession – the double whammy of decreased financial support and increased demand for their services among people affected economically by COVID-19. To make matters worse, Giving USA reports that before COVID-19 donations to nonprofits were down. The key reasons seem to be that in response to the Tax Cuts and Jobs Act (TCJA) that went into effect in 2018, the number of federal income taxpayers itemizing their deductions – including for charitable contributions – has dropped. For example, our tax household now takes the standard deduction, but we are mindful to continue to give generously to nonprofits.
To read the full article, visit the WalletHub website.