Charitable Giving At Holiday Time

It’s the season for giving! And I want to encourage everyone’s generosity.

I also want to make sure people’s gifts go where people intend them to go.

During the holiday season, when everyone is celebrating and buying gifts, it’s a fundraiser’s favorite time of year. People want to give at the holidays, especially to their favorite nonprofit organizations.

Unfortunately scammers know this too, and con artists crawl out of the woodwork this time of year.

A few tips to avoid charity scams:

• Don’t let anyone pressure you into giving. Any legitimate organization will still be there tomorrow
• Watch out for phony caller ID’s
• Watch out for misspellings of the charity’s name
• Don’t give gift cards as donations (unless to a food bank or church)
• Don’t give via Western Union or other wire transfers

All this is fairly common information.

What I wanted to add to the usual advice are some proactive giving tips gathered from watching how foundations work.

Foundations are organizations created to give away large amounts of money. They are often sponsored by large corporations and sometimes by very wealthy individuals or families.

A foundation is directed by its founder(s) to give money in areas the founder values. For example, the goal of Microsoft Philanthropies is to enhance peoples’ lives through technology.

So think of yourself as a very small foundation. Like the larger foundations, you have a certain amount of money you can budget to give away each year. You also have causes that you believe in. And like a foundation, it helps to set goals. For example, “I would like to support the arts in a 50-mile radius of my home” or “I would like to help give children an education.” (It’s OK to have more than one goal – many foundations do!)

Then it’s a matter of matching your goals to organizations requesting funds. With a foundation, organizations send in a grant proposal asking for money. Everyday people usually just receive a letter in the mail requesting money and an envelope to send it in.

Take a look at which letters describe charities that match your goals and priorities. Maybe run some Google searches in your area(s) of interest. There may be only a few charities that match your goals, or there may be dozens and you’ll need to whittle down the list. Decide how you want to spread out your donation budget among the different envelopes, then write your checks. And you may want to set aside a little bit of cash for “mad money” donations later in the year.

The benefit to this process is that (like foundations) you’ll find you’re able to give more than you usually do, and your money accomplishes more because it’s better targeted.

Something to think about, and maybe to try. If you do let me know how you like this approach!