“Buyer beware” is good advice, but givers should be just as cautious.
A list of America’s worst charities compiled by The Center for Investigative Reporting and the Tampa Bay Times makes it clear people need to be careful with their generosity to make their dollars count.
The recently released list reveals just how calculating these less reputable charities can be. The No. 1 ranked worst charity is the Kids Wish Network — sounds an awful lot like the well-known Make-A-Wish Foundation — which has for years granted children with life-threatening illnesses a wish. The Kids Wish Network has raised millions of dollars over the decade. Of that money, about 80 percent — $110 million — has gone to professional solicitors, $4.8 million has gone to the charity’s founder and his consulting firm, and only 3 cents of every $1 that they’ve raised has actually spent directly on helping kids, according to the Center for Investigative Reporting.
Picking similar names to familiar charities is obviously a successful strategy because coming in at No. 3 on the list is Children’s Wish Foundation International. (And there are many others on the “worst” list with “Children” in the name.) Other popular names contain key disease words, such as cancer and diabetes; and others include words such as veterans, firefighters and police officers.
All of the charities on the list, according to the report, spend a minimal amount of the money collected on actual aid. The best charities spend no more than 35 cents of every dollar raised on fundraising costs. American’s worst charities spend more than 80 cents of every dollar on fundraising.
So when you answer the phone and are asked for money, send up the red flag. Charities that use telemarketing firms and fundraisers are far more likely to receive only a fraction of the money raised for its intended charitable purpose. One savvy consumer said, when asked over the phone to contribute money to a charity, his reply is to request that the charity mail its financial statement first. Not so surprisingly, those never arrive.
The solution, however, is not to give up on giving. This country has a reputation of being generous and it would be a shame to see that change. We give more to charity per capita than any other developed nation — more than $200 billion in 2011, according to Marketplace Money.
In this state the Minnesota Charities Review Council is a good resource to check out a charitable group’s reputation. The council reviews charities through its voluntary review process. When an organization meets all 27 accountability standards, it earns the Meets Standards seal. The organization is then added to the council’s website and newsletter, providing the public with a detailed list of information about trustworthy nonprofits (smartgivers.org).
Not all charitable causes, such as the neighborhood school’s annual spaghetti feed or smaller nonprofits, will necessarily have undergone comprehensive reviews, such as those done by the Review Council. The best tactic is to be familiar with the organization you’re giving to, and if you’re not, ask a lot of questions.
No doubt, too many charities on the “worst” list are wishing you won’t bother to be an informed giver.