Every year, millions of dollars are donated to charities throughout the country. While many legitimate organizations rely on donations, there are some people out there just waiting to take advantage of your generosity. Before mailing that check or hitting send on your donation, make sure you take these steps to ensure the charity is legitimate.
There are several websites out there where their sole purpose is to examine how charities are operated. Some of them include: Charity Navigator, GreatNonProfits, GuideStar, and more. Visit one of these sites and run a quick search on the charity of your choice.
Public charities post their annual reports so you can see where their donations are going. While some of these funds can be expected to go towards finances, such as paying employees, the majority should be going towards the cause for which the funds are being raised. It at least 70% of funds are going towards the cause, this is usually a sign of an efficient, well-run charity. If you aren’t able to find an annual report or any kind of transparency, it’s probably a good idea to find another charity.
FORM OF PAYMENT
How a charity asks you to donate may be a red flag that they are not a legitimate charity. For examples, most charities will probably accept your donation in the form of a credit card on a secure website. If you are asked to send a personal wire, pre-paid debit cards, or gift cards, this may be a sign that the charity is not legitimate.
FIND THE IMPACT
If a charity is making claims that you can’t find evidence of, such as using their funds to build playgrounds at local schools, this may also be a red flag. Look through their website, as charities like to show what they’re doing in order to encourage people to donate.