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The Color of Money: Money is tight; give wisely

The next several weeks are crucial for the charities; most of them receive one-third to half of their overall contributions in the last three months of the year. Before making a donation, make sure that the charity is using most of the money it takes in to provide the services it supports.
The next several weeks are crucial for the charities; most of them receive one-third to half of their overall contributions in the last three months of the year. Before making a donation, make sure that the charity is using most of the money it takes in to provide the services it supports. (Rick Bowmer/associated Press)
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By Michelle Singletary
Sunday, November 22, 2009

There's no surprise that charitable giving is down this year. A recession can make even the most altruistic person pull back.

Fifty-one percent of charitable organizations responding to a poll by the Association of Fundraising Professionals reported lower fundraising totals so far in 2009 compared with the same period last year.

The next several weeks are crucial for the charities; most of them receive anywhere from one-third to half of their overall contributions in the last three months of the year.

Giving USA Foundation, a philanthropic research group, said total donations to charitable organizations came in at $307.65 billion in 2008, down 2 percent from 2007. The decline was the first since 1987.

In this climate, the competition for charitable dollars intensifies. And it's important for you, the donor, to make sure every penny of your charitable funds goes to legitimate groups.

So, I'm asking -- pleading -- that before you give money to a charity you are unfamiliar with, do some research. Give wisely by not only making sure the charity is legitimate but that it's well run. One of the first things you should do when contacted for donations is to contact the office that regulates charitable organizations and charitable solicitations in your state to see if the charity or fundraiser must be registered. For a list of state offices, visit the National Association of State Charity Officials at http://www.nasconet.org/agencies. There are two other places you should search: the Better Business Bureau and Charity Navigator.

The BBB Wise Giving Alliance at http://www.bbb.org/charityhas valuable information about whether any complaints have been filed against organizations and whether groups meet the BBB's 20 Standards for Charity Accountability, which include such matters as charity governance, finances, fundraising and donor privacy.

"When donating to a charity, give wisely by vetting the organization fully; this will ensure your dollar goes as far as it can to help those less fortunate," said H. Art Taylor, president and chief executive of the BBB Wise Giving Alliance.

The BBB says some of the questions you should ask include:

-- Is this a charity I can trust? The names of some charities sound similar. Don't be fooled by names that seem the same.

-- How will the charity use my donation? Be wary of statements such as "all proceeds will go to the charity." This can mean the money left after expenses, such as the cost of promotional materials and fundraising efforts. "Donors should ask what percentage of their gift is directed to the cause to which they are giving as opposed to the organization's operating expenses," says Howard Schwartz, communications director for the Connecticut Better Business Bureau.

Professional for-profit fundraising companies may keep anywhere from 25 cents to 95 cents of every dollar they collect, according to Charity Navigator. The organization said efficient charities spend less than 25 percent on fundraising and administrative fees. You want to ensure that the charity is using most of the money it takes in to provide the services it supports.


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