Give Smarter (Part III)

Continued from yesterday’s post

I would be remiss if I did not talk a moment about money. Donating money is what most people think of when they think of charitable giving and there are a couple of things, three really, that you need to know and think about when considering a cash donation to a charity. Specifically;

1. How generous we really are in this country

2. Where most of the cash donations come from

3. The average efficiency of charitable organizations.

 There are needs in this world that require funding. While some needs can be met with time and talent, others require cash. We would all like to be able to give enough to make a difference: some people have greater resources than others.

 Sometimes we turn on the news and see a major gift from a Warren Buffet or Bill Gates and we are overwhelmed at both their resources and their generosity. We see a major corporation or foundation donate millions to a cause and we feel that perhaps there is nothing we can add to the effort; we think…”my donation hardly compares to that.” May I tell you something that will no doubt surprise you?

The United States is the most generous country in the world. We give to help others, we give to help our own. In 2007 American donations reached the $300 billion dollar level; all to charity. That includes churches and universities and charitable organizations of all sizes, but think about that for a moment; $300 BILLION dollars.

 That would seem to be enough to solve a lot of problems. Understand this about that staggering number: As amazing as the total is, the way we get there is even MORE amazing.

Of that $300 Billion in annual giving, only 30% comes from big corporations and foundations. So where did the other 70% or $210 Billion come from? It came from individual donors at an average donation of just over $50 per gift.

 70% of all charitable giving comes from people just like you and me, giving a little bit at a time. It comes from the church collection plate, the Boy Scout Drive, the alumni association donations; your response to the late-night infomercial about starving children….it is an accumulation.

You have significant power as a cash donor, because of your associations. While you may feel that a single, small cash donation is insignificant, you as a community member, a credit union member, have a great deal of power in your giving. Whether combined intentionally with people you know, or unintentionally by virtue of you being a generous person, you are responsible for 70% of the cash giving in this country.  

 I mentioned that there were three things I wanted you to know about the total charitable giving in the U.S.

The first was that we are generous; $300 Billion in 2007.
The second is that 70% of that total or $210 Billion comes in at an average of $50 at a time.
Unfortunately, the third thing is that $300 billion in benefit is not received as a result of all that giving.

There is waste, there is fraud, there is replication of effort. Unfortunately the average efficiency of a U.S charity is right around 50% which means only half of every dollar you donate actually does anybody any good. Many will not tell you this statistic because they are afraid you will stop giving. But I am not afraid of that. I actually believe people would give even more, if they could see the results.

 And so we need to be honest and realize that half of what is given goes to overhead, marketing, fund raising…and sometimes, it just disappears.  In 2006, the IRS reported nearly 2 million registered charitable organizations in the U.S. Specific to kids, over 30,000 are registered for the purpose of helping kids.

How do you choose among this many organizations? And then think about all of the replication of overhead; light bills, postage, supplies, staff salaries…and sadly some organizations are run be very good-hearted people who may not have the experience in management equal to their passion for helping others. It is a reality that we are compelled to think about.  

 It is no wonder that trust suffers. A recent poll released by Harris Interactive reveals that only 1 in 10 Americans strongly believes that most charities are honest and ethical. And yet they continue to give.

 Nearly 1 in 3 actually believes that there is serious mismanagement among charitable organizations. And yet for reasons within themselves,  people continue to give.

 After 9/11 and Hurricane Katrina, donations in this country were off the charts. Then they came to understand that a lot of the money did not make it to the people who needed it. And yet people continue to give.

People who make less than $50,000 a year make most of the cash donations to charities. Gas prices go up, grocery prices go up, the cost of virtually everything keeps going up. And yet people who can afford it the least, continue to give. 

I am not concerned about delivering this information to you. In fact I am motivated to do so because our inherent need to serve and help one another deserves a little better that we are getting.

 You need to understand that there are some very efficient charities out there where upwards of 85% and in some cases, 100%, of every dollar received, goes to programs…goes to help the person in need. Just as there are charities to be careful of, there are also charities you can trust. As you consider giving and your resources of time, talent and money, when it comes to your money, please do the responsible thing: give smarter.

Expect results from your donations. How do you do this? Well there are levels but at a basic level:

  • Don’t be afraid or hesitant to ask where the money goes.
  • Take a moment and look at web sites such as Charity Navigator or Guidestar; these sites rate charities. You can look up charities on these sites and at a basic level make sure they are registered and get a glimpse of their efficiency and track record.
  • You can call the Better Business Bureau and get information on a charity’s efficiency.
  • Determine the area of need you would like to benefit and focus on that; then…shop around. If you don’t like the information you receive on one organization, keep looking.
  • You can turn to a professional if you need advice. This is why we formed Operation Kids; to ask the hard questions and help donors find a better way to give.

This all takes a little more time, but it is ultimately the only way to make sure more of those precious dollars reach a child in need.

We do this for a simple compelling reason: How exciting would it be, if more of those annual gifts in this country, more of that $300 billion, found its way to the most efficient and most accountable charities; and consequently to the child in need? Don’t you find that a motivating concept? I do.

You alone may not have the ability to build a school or fund a medical procedure or rebuild a community, but together you do! A collective effort of a group this size, this room full of people, properly placed, is enough to provide matching funds for an organ transplant. It is enough to fund a youth internship program for more than 200 kids in New Orleans. It is enough to fund 3 national chapters of Best Buddies, which is the day-to-day manifestation of Special Olympics; they provide mentoring to kids with intellectual disabilities.

 You could fund over 500 corrective facial surgeries through a group like Operation Smile. You could build 6 new schools in Ghana.

 Life for us in this country, is good. We have so much to be thankful for. If you did not go to bed hungry last night, you were better off than 854 million other people in the world. Most of us cannot even comprehend what that means.

 Although we each face challenges, we are all “privileged” by world standards. We have abundant food, clothing and shelter. We earn more than a subsistence living. We have access to education and some level of health care and the opportunity to improve our circumstances.  And because of these privileges, we can and SHOULD, help others. 

 As the head of Operation Kids, I admire people who give. I admire campus cops: likely to be “one of six.” I admire teachers–easily “one of six.” I admire coaches, both volunteer and paid: the ones who teach discipline and honor and teamwork and sportsmanship. Truly “one of six.”

I admire high school guidance counselors; one of six. I admire retired folks who act as crossing guards even in the winter. I admire dance instructors and piano teachers and pediatricians…who understand that they have a moment or two, each and every day, to touch a young life; who are willing to step up and be…one of six.

 And I admire people who make an average income and still find a way to donate part of their relative wealth, to others in need.

 Service is a day-to-day manifestation of hope; if you have a desire to serve then you also carry a hope that tomorrow can be better than today, and that you can be a part of making it so. If there is anything Operation Kids can do to help you in your efforts to serve, that would be our privilege.

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1 Comment

Filed under Initiative: Charitable Giving & Accountability

One response to “Give Smarter (Part III)

  1. So beautifully stated. It is my goal to help donors find ways to give more. I’m just starting a blog to educate on different strategies for planned giving. It’s staggering the percentage of donations coming in $50 at a time. Thank you for your insights.

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