Sites like Charity Navigator are very helpful in showing you what percentage of your giving goes to support the mission of the nonprofit, as opposed to administrative expenses. Some nonprofits may have quite a bit of overhead, but according to the charity ratings site, if they are spending more than 33.3% of their total budget on overhead, the organization is simply not meeting its mission.
How Does Your Favorite Charity Measure Up?
According to Charity Navigator, the following charities are hugely popular with donors. Do you know how much money they spend on actual programming?
American Red Cross
The do-gooders at the American Red Cross do a good job of spending your money when you donate. They manage to keep administrative expenses at less than 5% of their total overhead, and they spend 92.1% of their income on actual programs that benefit the community. Whether it's teacher CPR, or managing crisis during the aftermath of a disaster, the Red Cross puts your money to good use.
Approximately 85 cents for every dollar you donate to World Vision goes to help stamp out poverty around the world. While they are still well below the 33% benchmark, they tend to spend more on fundraising than other charities. Nonetheless, if stamping out poverty is your passion, World Vision does a good job with your dollars.
Doctors Without Borders
These brave folks at Doctors Without Borders go into the most deplorable conditions to bring healing to others. Your money here is well spent: approximately 86 to 89 cents of every dollar you give goes to supporting the overall mission.
You may have heard of Invisible Children quite a bit recently. This is the group which produced the film Kony 2012, and started a highly successful social media campaign to spread awareness. The group's goal is to use media and social action to end the use of child soldiers in Uganda, mostly through promoting awareness of Joseph Kony, leader of the LRA. The group spends about 80% of its donations to fund this goal.
American Cancer Society
Probably one of the most well-known charities, the American Cancer Society seeks to educate and support research efforts to help support and improve the lives of those who are fighting cancer. The charity spends about 59 cents per dollar on programs that directly support its mission. This is lower than typically well-rated charities; however, it is also a charity that requires more overhead than most in terms of research facilities and equipment. It should also be noted that the ACS doesn't have a substantial budget for administrative expenses, but does spend about 34% on fundraising annually.
Great Charities That Spend Their Money Well
While these might not be the most popular nonprofits, the following list of charities knows how to get the most bang for their bucks. With less than 10% overhead, these charities will spend 90% or more of the money that you donate on actual goods and services that support their missions.
- Greater Chicago Food Depository
- Oregon Food Bank
- The Conservation Fund
- Give Kids the World
- Save the Children
Charities with Lots of Overhead
To be considered a charity that spends its money well, at least 66.6% of all donations should go directly towards programs that support the charity's mission. While these charities fall well within this guideline, they do tend to accrue more overhead and administrative expenses than some other charities. The following popular charities spend 20 to 30 cents on the donated dollar for overhead and administrative expenses.
- The Nature Conservancy
- World Wildlife Federation
- Oxfam America
- Natural Resources Defense Council
Charities that Spend 30% or More on Overhead
If you care deeply that the bulk of your money goes to benefit the cause directly, these are charities you may want to investigate further before making your donation. The following charities spend at least 30 cents or more for every donated dollar on things like overhead, administrative costs, and fundraising.
- George Bush Presidential Library Foundation
- Alzheimer's Foundation of America
- The Cable Center
- American Printing House for the Blind
Whether your passion is art or tapirs in the rainforest, there is a charity that would like to put to use your hard-earned dollars. Choosing a charity can be a hit or miss, though, if you don't do your research. Fortunately, not only are there charity watchdog groups, but charities are also required to file certain documents for public viewing.
Charity Watchdog Resources
In addition to Charity Navigator, there are several other impartial groups who simply collect information and present it for donors' consideration. Any of the following resources is a good place to start when you're considering giving away your money:
- CharityWatch - The American Institute of Philanthropy puts out this website that rates hundreds of charities on their financial dealings. If you know the name of your charity, searching will be much easier.
- GuideStar - GuideStar collects 990 forms and other public financial data for many charities. It focuses on a community interface that lets you leave commentary about specific charities as well.
- Give Well - Give Well reviews hundreds of charities in addition to giving you guidance in reviewing nonprofits they may not have reviewed yet.
Questions You Can Ask
If you find that the charity you want to give to has not yet been rated on any watchdog sites, you can do the legwork yourself. Ask the following questions when you're researching to help guide you on your giving:
- Is the nonprofit actually a charity? You can find this out by searching for its 990. This information is typically found on a charity watchdog site; however, you can also visit the Wise Giving Alliance at the Better Business Bureau to see if anything has been filed for your charity. Note that religious institutions such as churches and synagogues typically do not have to file a 990.
- Are there complaints against the charity's practices? Again, this information is found easily on the Wise Giving Alliance website.
- Do the charity's marketing materials clearly state the problem and explain what they are doing to help? Be wary of charities who drone on about the problem but fail to state what they are doing to help it.
- Ask the organization what percentage of donations go to actually support the programs in lieu of overhead and administrative costs. Be wary of a charity that says 100% of donations go to support the cause. After all, there has to be at least some overhead.
Making informed choices is the best way to make sure that your dollar goes to support causes that you deeply care about. To further ensure that your money is well-spent on a cause that you are passionate about, consider volunteering your time and talents so you can see first hand what happens from donation dollar to the delivery of programs and services.