How to Choose a Charity Wisely – Watch Red Flags

Americans are giving to charity more than ever. In light of the most recent natural disasters and the holiday season approaching, there’s a new sense of urgency to charitable giving. But how many of us really know how our donations are being spent – and that they’ll make a difference?Before making donations, donors should do their research to ensure they’re choosing wisely. Evaluators such as Charity Navigator offer charity ratings and in-depth analysis of U.S.-based charities, with criteria including financial management and accountability. Givers should also understand the cause they’re trying to support, and look for charities that effectively address the causes they’re passionate about.

Join me in recent interview with Thomas Tighe, CEO of Direct Relief – one of the nation’s highest rated and most reputable NGOs as he can shares tips on charitable giving, explain red flags, suggest questions that people should ask when making a gift, and offer recommendations for charities.

Check out the entire interview here.

Also, here are some tips Thomas mentioned regarding red flags donors should be aware of when getting solicitations:

  • Urgency: You shouldn’t be made to feel rushed into donating – a reputable organization will understand if you need a few days to decide and do some research on the charity in question.
  • Vague Details: Don’t be afraid to ask exactly how your money will be used, how the charity ensures donation integrity, and what percentage of cash donations goes to people in need (vs going to payroll or fundraising). With the worst offending charities, only 2-3% of cash donations actually go to those in need.
  • Fine Print: Many organizations use fine print regarding their use of donated funds. Such language can be easily overlooked but is highly consequential.

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*Photos courtesy of Direct Relief

Lindsey Jenn

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