Giving to charity is a pretty hot button topic around the personal finance blogosphere. Everybody seems to have their own beliefs on whether or not you should give, how much, and to whom. Ironically, just talking about giving back can unleash a firestorm of vitriolic comments that we usually prefer to avoid.

We don’t talk much about our personal giving on this blog. It isn’t that we don’t give. We do. However, we kind of follow the philosophy that if you need to advertise your giving, it really isn’t charity. Plus, most of the things we give to are either local causes or a simple “hand-up” to people that we know personally, so it really isn’t exciting reading material for a worldwide audience.

Choosing and giving to a charity is a very personal decision. Giving back not only helps out your favorite causes, but it can also give you the warm and fuuzies on the inside. Everybody wins!

Yet, not all charities are equal. According to the National Center for Charitable Statistics, there are over 1.5 million nonprofit organizations in the United States. Since each organization is built and run differently, how do you choose? Before you decide to give away your hard-earned cash, here are a few things you may want to think about.

Choose a Cause That Moves You

Some people think that it is imperative to build their charitable giving into each and every budget. Others don’t feel like charitable giving is something that they


should do at all. Neither is wrong. Giving is something that is very personal and should come from the heart. If you want to give, great. If you don’t, that is fine too. Perhaps you just haven’t found the right cause yet.

If you’ve decided to give but don’t know where to start, think about what issues or causes strike an emotional cord with you. Perhaps you have a family member with autism. You may look into something as simple as purchasing some autism awareness products. Or, if you are an animal lover, you might explore options for donating to your local animal shelter or humane society. Choosing to give to something that moves you makes it much more likely that you’ll find satisfaction in your gift. You’ll feel like you’ve made a difference that matters…and that feeling will encourage you to keep giving in the future.

How is the Money Spent?

When it comes how they spend your money, not all charities are created equal either. Not by a long shot. Before you give, you really should ask where your money is spent. Is most of the money being used to fund the cause that the charity claims it is for, or are 90% of the donations used to fund administrative costs? That information can make a world of difference between whether or not you decide to give to that particular charity.

Don’t get me wrong. I know that you need to pay people to work at these charities so that they can raise awareness (and money) for their particular cause. I’m a capitalist. I get it. However, some charitable organizations seem to be in the business of collecting donations just to keep the charitable organization afloat. Personally, I would rather not give my money to an organization that is simply soliciting donations to pay for a person to continue to solicit donations…which will pay for that same person to continue to solicit donations. I want the money I give to be used for the cause that I’m giving it to. If I want to create a job, I’ll hire an employee. #thankyouverymuch

You may think that giving locally would squash this problem…but beware. Your local charity could be run just as poorly as the national/international one. Do your research before you give. Websites like Charity Watch and Charity Navigator can help you vet some of the larger organizations.

Where Do You Want to Make a Difference?

Speaking of local versus national charities, you will want to decide where you would like your charitable donations spent. Whether you are looking at national/worldwide charities or local ones, remember that neither is necessarily better than the other – they may just have a different focus. Larger charities are usually going to fund either research based causes or use their donations to fund smaller charities. Locally based charities will typically focus more on specific local issues.

For example, let’s say that you decide that donating to a cancer charity is something that moves you. While the American Cancer Society may provide money for different types of cancer research, a locally based cancer charity may provide funds to individual local cancer patients to help them pay for their treatments. Neither is necessarily better than the other. They just have a different focus. One impacts cancer patients as a whole, while the other impacts individual patients. It is up to you to decide if the charity’s focus fits your charitable vision.

If you want the best of both worlds, you may consider giving to a local service club. Local chapters of Rotary International, Kiwanis International, or Lions Club International (among others) will usually split a percentage of the donations they receive between local and national/international projects. If you don’t have a specific cause that moves you, this is a great way to make your charitable giving go to work in both your home town and around the world.

Charitable giving is a great way to give back to the communities that you feel have given so much to you. Whether you want to help fund children’s diabetes research or fund a local scholarship program, there is a charity out there for you to support. If you want to make sure your giving dollars are having the impact you desire, be sure to do your research and know exactly what your gifts are supporting before you give.

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