Do you give charitable donations during the holiday season? Many people do, which is why you see so many people in Santa hats ringing bells outside bustling stores.
Have you ever wondered where that money goes? What about other charities like cancer research, children’s hospitals or even places like Ronald McDonald House?
Before you give to a specific cause this season, make sure to look up the organization’s ratings first. Not all charities are created equal. Some are even out to scam you. Tap or click here for the 6 worst scams spreading on the web.
Why are charities rated?
Charities receive ratings based on the kinds of programs and services they provide, as well as how they handle donations. As Consumer Reports explains, not all charities do what they claim.
Some spend more on administrative and fundraising costs than they do actually giving to their causes, while others are fakes that scam people out of their money.
Watchdog websites can help you see whether a charity is a registered public 501(c)(3) organization. Those that are registered are legally recognized for their charitable programs.
But even if an organization is certified, it doesn’t mean it appropriates funds responsibly. Charity rating sites break down their scores into sections to provide the details you want, like what percentage of your donation is actually used to help the cause you care about.
Where can I check ratings?
We suggest you visit several watchdog sites to see how your cause of choice stacks up. Not every site rates charities according to the same criteria, so it’s worth comparing the same charity on at least two sites before you donate.
Try one (or more) of the following:
- BBB Wise Giving Alliance – This group accredits charities based on 20 criteria to ensure donations are handled appropriately.
- Charity Navigator – If you’re not sure what charity to donate to, visit this site for ideas. It has several to choose from and it rates charities on their financial health, accountability and transparency.
- CharityWatch – This nonprofit group has a list of causes you can sort through, or you can use the search bar to see how your preferred charity scores.
- GuideStar – Easily find an organization with values that match yours.
What if I can’t find my charity?
If the sites above haven’t ranked your charity of choice, keep your eye out for red flags. Here are guidelines the Federal Trade Commission (FTC) suggests when researching a charitable cause.
- Search for the cause you care about online, plus phrases like “best charity” or “highly rated charity.” Once you pick one, search its name plus “complaint,” “review,” “rating” or “scam.” If there are any red flags, consider donating to a different organization.
- Look up the charity’s website. Does it give any information about its programs or how it uses donations? How much of your donation will go directly to support programs? If you can’t find details, be suspicious.
- Look up your state’s charity regulator for assistance. You can look up your state’s regulator at nasconet.org.
The FTC offers more information, such as how to respond if you receive donation requests through social media or crowdfunding sites, what to do after you donate, how to handle charitable solicitation calls and more. For more info about donating or handling solicitors, tap or click here.
If you’re still not sure which charity to donate to, consider one of the rating sites. They’re also nonprofits and could use financial assistance too.