Charitable Giving
It's nearly the end of the year - again! - and I know that some of you are starting to think about end-of-year charitable giving. Last year, I posted this post about some areas that were in crisis at that time and also links to some sites where you could find out how various charities "rated."
This year I wanted to share a few thoughts about the whole issue of "administrative" costs, as well as thinking about year-round giving.
One of the standards that is often touted is that at least 70% of any dollar should go to program costs versus "overhead" or "administrative" costs. That's not necessarily a bad standard, but it's also important to keep in mind that:
a) there are no standards about what is counted as a program cost versus administrative cost. Therefore, the salary for a social worker who helps homeless families find housing and/or work could be counted as an administrative cost in one agency (salaries are often considered overhead), or it could, in another agency be counted as program costs (the social worker is providing a service to the agency's clients). So, "admin" costs are not necessarily equivalent from one nonprofit to the next.
b) one of the crises facing the nonprofits right now is both staff turnover, and the coming expected wave of baby boomers who should be retiring from director/leadership positions in the sector. However, there are nonprofits where the retirement benefits are so bad/non existent that some EDs can't afford to retire. And, while the nonprofit sector - generally speaking - offers some decent health benefits, etc., it also has generally lower salaries, so that many young people graduating from college right now can't afford to go work in the nonprofit sector because of student loans. So, as you look at charities, an overhead rate that is really low may be less about efficiency and more about the fact that workers there aren't paid very well or have very good benefits. Again - not a hard rule, but something to think about.
c) and, raising money takes money and resources, which leads me to my suggestion for the year - think about providing year-round support for your favorite charity(ies).
One of the challenges that charities face is inconsistent revenue. Since many people confine their charitable donations to situations of crisis or end-of-year, nonprofits can't count on on-going cash flow and also have to put more into fundraising efforts.
Many groups now offer and encourage signing up for monthly donations via credit card or checking account. This has, IMO, advantages for everyone - charities can count on income coming in every month. You can sign up at very low levels with most of these groups (often as low as $5/mo). If, like me, you get airline miles or other points on your credit card, you can rack those up as you make donations. All of the charities with whom I do monthly donations have removed me from any other mailings, so it's cut back on my charitable solicitations. The way I've set up my charitable giving is that I've set aside approximately half of my charitable giving through monthly donations, and then I make ad hoc donations to other organizations I care about. So, if you have an organization you really care about and know you're going to support year after year, you might want to look into the monthly donation route. Trust me - the charity will thank you :-)
I recently sat in on a conference call about humanitarian crises around the world. They are, objectively, more natural disasters each year in the last couple of decades than previously. The Centre for Research on the Epidemiology of Disasters has been tracking natural disasters and there are now over 300 such disasters recorded each year. So, disaster relief remains a key need for giving. But, there are many organizations all over the world, engaging in short-term and long-term work that are also doing amazing things.
Finally, a listing of some of my favorite charities. Please feel free to add your own to the post in the comments.
Doctors without Borders - still operating in Darfur and many other areas that so much of the world seems to have forgotten about or neglected.
Mercy Corps - remarkable humanitarian work and community building all over the world
Your local community foundation - all over the US are community foundations that focus on raising funds and tackling the tough problems in their local communities. This link will help you find your community foundation.
On the Rise - fantastic group here in the Boston area helping women find new lives
Notre Dame Mission Volunteers - I always joke that these are my "favorite nuns." They are an AmeriCorps program I worked with, and with whom I have always been incredibly impressed. These are nuns truly doing God's work, and teaching a whole new generation what it means to serve. One of the things I most admired about them was their ability to share their spirituality without ever making you feel like you were being preached at or lectured to.
Southern Poverty Law Center - taking on the toughest civil rights issues.
Oxfam - providing disaster relief, but also working on long-term poverty solutions
Human Rights Watch and Amnesty International - working to protect human rights world wide
I'll leave this post unlocked - feel free to link, if that's useful.
I know many of you give generously of your time and money to causes that are important to you. Please feel free to add other resources or links to your favorite charities in the comments section.
Peace, my friends,
Viv
This year I wanted to share a few thoughts about the whole issue of "administrative" costs, as well as thinking about year-round giving.
One of the standards that is often touted is that at least 70% of any dollar should go to program costs versus "overhead" or "administrative" costs. That's not necessarily a bad standard, but it's also important to keep in mind that:
a) there are no standards about what is counted as a program cost versus administrative cost. Therefore, the salary for a social worker who helps homeless families find housing and/or work could be counted as an administrative cost in one agency (salaries are often considered overhead), or it could, in another agency be counted as program costs (the social worker is providing a service to the agency's clients). So, "admin" costs are not necessarily equivalent from one nonprofit to the next.
b) one of the crises facing the nonprofits right now is both staff turnover, and the coming expected wave of baby boomers who should be retiring from director/leadership positions in the sector. However, there are nonprofits where the retirement benefits are so bad/non existent that some EDs can't afford to retire. And, while the nonprofit sector - generally speaking - offers some decent health benefits, etc., it also has generally lower salaries, so that many young people graduating from college right now can't afford to go work in the nonprofit sector because of student loans. So, as you look at charities, an overhead rate that is really low may be less about efficiency and more about the fact that workers there aren't paid very well or have very good benefits. Again - not a hard rule, but something to think about.
c) and, raising money takes money and resources, which leads me to my suggestion for the year - think about providing year-round support for your favorite charity(ies).
One of the challenges that charities face is inconsistent revenue. Since many people confine their charitable donations to situations of crisis or end-of-year, nonprofits can't count on on-going cash flow and also have to put more into fundraising efforts.
Many groups now offer and encourage signing up for monthly donations via credit card or checking account. This has, IMO, advantages for everyone - charities can count on income coming in every month. You can sign up at very low levels with most of these groups (often as low as $5/mo). If, like me, you get airline miles or other points on your credit card, you can rack those up as you make donations. All of the charities with whom I do monthly donations have removed me from any other mailings, so it's cut back on my charitable solicitations. The way I've set up my charitable giving is that I've set aside approximately half of my charitable giving through monthly donations, and then I make ad hoc donations to other organizations I care about. So, if you have an organization you really care about and know you're going to support year after year, you might want to look into the monthly donation route. Trust me - the charity will thank you :-)
I recently sat in on a conference call about humanitarian crises around the world. They are, objectively, more natural disasters each year in the last couple of decades than previously. The Centre for Research on the Epidemiology of Disasters has been tracking natural disasters and there are now over 300 such disasters recorded each year. So, disaster relief remains a key need for giving. But, there are many organizations all over the world, engaging in short-term and long-term work that are also doing amazing things.
Finally, a listing of some of my favorite charities. Please feel free to add your own to the post in the comments.
Doctors without Borders - still operating in Darfur and many other areas that so much of the world seems to have forgotten about or neglected.
Mercy Corps - remarkable humanitarian work and community building all over the world
Your local community foundation - all over the US are community foundations that focus on raising funds and tackling the tough problems in their local communities. This link will help you find your community foundation.
On the Rise - fantastic group here in the Boston area helping women find new lives
Notre Dame Mission Volunteers - I always joke that these are my "favorite nuns." They are an AmeriCorps program I worked with, and with whom I have always been incredibly impressed. These are nuns truly doing God's work, and teaching a whole new generation what it means to serve. One of the things I most admired about them was their ability to share their spirituality without ever making you feel like you were being preached at or lectured to.
Southern Poverty Law Center - taking on the toughest civil rights issues.
Oxfam - providing disaster relief, but also working on long-term poverty solutions
Human Rights Watch and Amnesty International - working to protect human rights world wide
I'll leave this post unlocked - feel free to link, if that's useful.
I know many of you give generously of your time and money to causes that are important to you. Please feel free to add other resources or links to your favorite charities in the comments section.
Peace, my friends,
Viv