December 1, 2015

Does your Charity Spend Its Donations Wisely?

Speaking of year end charitable contributions, have you taken time to see if your charity spends its donations wisely?

Just because an entity is a non-profit organization does not, unfortunately, guarantee that charitable donations to the organization are spent wisely.  Some of the worst charities in the United States actually spend less than 1% of contributions (gulp!) on charitable programs; all other money goes to “other” expenses such as board member and employee salaries, entertainment, travel …. Well you get it.

The Tampa Bay Times newspaper does an outstanding job with ongoing charity research.  Here is their very informative compilation listing the Worst Charities in the United States.  Eye opening and jaw dropping, to say the least.

Benchmark for a Well Run Charity

When discussing charitable contributions with my financial planning and tax clients, I generally counsel clients to consider a charity efficiently run if at least 75% of its its budget is spent on the programs and services the charity delivers.  (This is also the benchmark suggested by Charity Navigator.)

My festive live Christmas tree in my
home office, a a stone mountain pine.

Good charities generally publicize how well they use their contributions toward charitable programs.  One of my personal favorite charities, Muttville Senior Dog Rescue
in San Francisco, California, states in its  current newsletter that 83% of every donated dollar is spent on the senior dogs it rescues from more than 135 animal shelters.  (Disclosure:  I donate to Muttville Senior Dog Rescue.)  

That’s pretty darn awesome!
Or should I say pawsome!
There are many wonderful charities like Muttville that prudently use your charitable contributions.  A little bit of investigation will provide peace of mind knowing that your charitable donations are well spent.

Please contact me if you have questions about financial planning or tax matters.  Complimentary initial consultations.  For information about my nationwide Consulting, Expert Witness, and Tax Services visit Fouts Financial Group.

Mary Rae Fouts

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