Give Wisely
How does someone give wisely? A savvy consumer knows how to ask the right questions and do a little homework. The same precautions are
essential before making donations. The following are some good questions to ask before you give:
Who wants your money?
If you are unfamiliar with the charity, get its full name, address, and telephone number. Many organizations have names that are very similar to well-known charities. Ask whether the organization is listed as a tax exempt public charity by the IRS and whether your donation will be tax deductible.
How would they use your donation?
A dramatic, heart-rending description of general need may get your attention, but you should know more before you give. Find out the substance of the appeal and the planned use of your money. For example, are the organization's main goals education and research, or service and distribution? If the organization's goal is public education, ask about their program in detail. Although some direct mail educational campaigns achieve very good results and may be an appropriate use of your money, some organizations print a few facts in the fundraising literature they send to you and call the mailing and printing expenses the costs of public education.
What percentage would go toward true charitable purposes?
Ask for written information that will show you a comparison of how much money the organization spends on administrative and fundraising fees and expenses versus how much it spends directly on the intended recipients or projects of the charity. You may want to compare the adminstrative costs, fees and expenses for several charities before deciding which charities to support.
Before giving, watch out for these red flags:
- High Pressure Phone Calls: A legitimate charity will be glad to give you the time needed to check it out.
- Prizes: Most honest charities do not try to entice you to give by telling you that you have won a prize when you haven't even entered a
contest.
- Avoidance of the U.S. Mail: Dishonest individuals usually try to avoid doing any business through the mail to avoid federal prosecution under
postal statutes. Instead, they will insist on using a private courier service or picking up your check themselves.
What to keep in mind when giving:
- Get information in writing from the charity before giving, including an annual report or other financial information.
- Do not give your credit card number out over the phone in response to a phone solicitation.
- Do not respond to letters that say you have pledged money unless you are certain that you did.
- Do not give cash. Write a check in the name of the charity, or if you are giving other property ask for a receipt.
- Consult a lawyer before making a significant gift, whether making such a gift outright, by will or by trust.
For More Information:
For charities that operate nationally, contact the Better Business Bureau's Philanthropic Advisory Service at (703) 267-0100; the
National Charities Information Bureau at (212) 929-6300; or the American Institute of Philanthropy at (314) 454-3040.
For local charities, organizations like your Better Business Bureau, chamber of commerce, or local chapter of the National Society of
Fundraising Executives may also have information.
If you come in contact with an organization about which you have a complaint or are suspicious, please contact the Office of the Texas
Attorney General. The number for the Consumer Protection Division in Austin is (512) 463-2070, or call 1-800-337-3928 between 8:00 a.m. and 5:00 p.m. and ask for the Charitable Trusts Section.
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