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Choosing a Nonprofit Organization to Support – It’s Not Dropping a Dollar in That Jar

You’ve got a dollar and you want to help someone with it. Is that possible? Every not-for-profit out there will tell you, “yes!” But we have all heard stories about donated funds being spent on things other than an organization’s program – out of control expenses such as the inflated salaries of the people who are doing the fundraising. Add to that news about people appearing to represent charities but instead benefitting themselves, and the impact of your dollar can seem elusive.

As a sophisticated donor, you can take a number of steps to ensure that your dollar goes where you want. If you’re in New Jersey, you have a choice of over 60,000 not-for-profit 501(c) (3) organizations with a total income in 2013 of around $67.8 billion. In Bergen, Essex, Hudson and Passaic counties there are 17,621 not-for-profits bringing in $19.9 billion. How can you make that dollar have the greatest impact?

The first step is simple – follow your heart. Think about what cause speaks to you most. The environment? Homelessness? Education? Animal welfare? Hunger? What gets you fired up? Once you’ve identified a cause that matches your core beliefs, decide where you want your donation to have the greatest impact. Regionally? Nationally? Internationally? Do you want to support a large charity or a small one, a new one or a well-established one? Feeling engaged with something meaningful to you and your family is the first important step. Otherwise, it’s just a dollar, whereas committing to a cause and a charity makes you a partner in change.

Now that you’ve narrowed down the organization that matches your vision, do your homework. There are a number of resources available to donors to help investigate and research the multitude of organizations willing to take your dollar. They review 501(c)(3) charities, provide advice on how to navigate the not-for-profit world, and use sophisticated measurement tools to rate charities. They can be very valuable to you. Visit these sites as you consider your giving options:

Charity Navigator *
Guide Star *
Give Well

Here are some points they recommend you consider as you conduct your research:

• Confirm the Organization’s Status – The label 501(c)(3) indicates tax-exempt status by the Internal Revenue Service. This is a basic designation and ensures that the charity meets the federal definition of a not-for-profit.
• Review the Mission Statement – Determine if the goals and progressive achievements of an organization match with your ideals and desire to partner long term.
• Accountability and Transparency – Understand where your dollar is headed. While not-for-profits are businesses and have legitimate overhead expenses, at least 70% of the money they raise should be going to the services the organization provides.
• Review Recent Financial Statements – Ask to see organization’s financials. A transparent organization should be ready, willing and able to discuss their finances, share information and provide literature about their work. Rock solid financials, transparent spending, executive compensation and the percentage of revenue that goes to services should be talking points for a charity.
• Compare Like Charities – Different types of work impact operating costs. Comparing an animal welfare charity to a food rescue charity would be unfair to both as their operating costs will be dramatically different.
• Trust Your Instincts.

Once you’ve done your due diligence and chosen an organization you feel you can truly support, give thought to concentrating your giving. If you have another dollar you’d like to share, give it to the same organization. Although in business this would be counterintuitive when you consider that diversifying minimizes risk, with charities – concentration can do more to bring about change. Spreading your donation dollar too much dilutes its potency. If you’ve chosen an organization that matches your vision, meets your standards and is well-run, your dollar will have greater impact when you commit to it long-term. In doing so, you become a partner in your chosen charity’s efforts to effect change. Making a long-term commitment to an organization allows you and them to develop a relationship that encourages growth, minimizes resource waste and allows for real success.

It’s an amazing and gratifying feeling to be part of helping your community, whether it’s local or global. The feeling is even better when you can confidently stand behind your chosen organization. These tips and tools can help you find the best place for you and your dollar.

*Table to Table Inc, is proud to have maintained its Charity Navigator 4-star rating for five consecutive years and rank as the second highest Human Services programs in the entire state. We’ve recently been recognized by the GuideStar Exchange as a Gold Level Participant Agency, a category representing less than .001% of the registered not for profits in the country. We welcome the community to ask any Table to Table employee or volunteer about what we do and how we do it. And as for that dollar you have. When donated to Table to Table you will provide 10 meals for a hungry neighbor. Clearly, you can make a difference with just a single dollar.

REAL PEOPLE, REAL STORIES.

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