Sometimes I give money, or buy a meal, for hungry street beggars, especially women who appear homeless. These people are straightforward about the fact that they are asking for help for themselves, so I know exactly where my money is going.
It seems legitimate when you are inside a store and the cashier asks you to donate a small amount when you pay for your purchase. However, there are many problems with this approach. Often it isn't clear exactly who is receiving the donation, and there is no way to research it on the spot to see if it is really a responsible organization. These organizations are usually operating legally, but many of them do not really spend much money on charitable purposes, instead paying a very high percentage to executives and money collectors.
There are too many online charity frauds to count. They are especially likely to pop up after a well-publicized tragedy, and they like to exploit the holiday giving season. In addition to being fake charities, these scams are often identity-theft schemes. Some fake charities create websites that are designed to trick donors by pretending to be the sites of real charities.
I make most of my charitable donations online, but only when I am absolutely sure the website is legitimate.
- Charity Watch lists its top-rated charities by category. To make the list, organizations must spend at least 75% of the money they collect on programs and must meet other criteria. The site also includes articles on charity problems.
- Charity Navigator rates several thousand organizations and provides information and tips on smart giving.
- Consumer Reports lists the best and worst charities in various categories.
Generosity is a healthy character trait, and one that can make the world a better place. We want to be sure that we do not enrich the bad guys, but that our help reaches those who truly need it.