More people than ever before are aware of issues around the world and feel the desire to help out other people in some philanthropic way. This desire has led to a growing number of philanthropies, which is great because it lets people get the help they need. Having more philanthropies leads to incredible benefits for humanity, but it can also create some problems, such as philanthropies that aren’t run properly or are complete scams. Every year, thousands of people fall victim to scams involving charitable causes that don’t actually exist or never see the money that’s donated. Other times, charities are simply mismanaged and barely any funds actually go toward helping those who need it the most. Many of these faux philanthropies are easy to spot, but sometimes it can be more difficult to know what’s real and what isn’t. Here are some tips to determine whether or not you can trust a philanthropy.
Check out how it ranks
When you first hear about a charity or are considering a donation, pay a visit to a site like Charity Navigator to see the nonprofit’s rank. The website provides you with a ranking, the location of the charity, and various other criteria. You can even opt to compare it to other charities and see how they score against each other. You can also check out the organization’s score for things like how it handles finances and whether or not it’s transparent. However, don’t worry if the philanthropy you’re looking for isn’t on the site; that doesn’t automatically mean it’s a scam!
Find out how its budget is spent
Most philanthropies publicly publish their budgets if they’re a nonprofit. You should be able to find the budget of the organization and see how they spend their money. Remember to also be wary of any organization that claims 100 percent of their donations go toward helping the cause. Sending all their money to support the cause is not feasible because some of it needs to be used to cover administrative costs, unless they’re receiving those funds from another source. Typically, 35 percent or less should go toward administrative costs.
Take a look at it online
After doing more official research, go ahead to look up the organization online. While you certainly cannot take everything you read online as fact, see what kind of reviews the philanthropy has and what people are saying about it. If it doesn’t seem to exist online, you should be skeptical about donating your money to it.
Be careful how you donate
Finally, no matter where you’re donating, avoid giving out credit card information. When possible, write a check or donate items. If someone pushes you to donate immediately or will only accept cash, it’s likely they’re running a scam and do not want people to look into what they’re doing or where the money goes.
Do your research into philanthropies in order to make sure you’re donating money where it will actually help and isn’t being wasted.