By Steve Gillman - September 19, 2011
I previously wrote a post titled, Give
Until it Hurts? My answer to the question was no. Humans
who develop normally are generous and will help others when their
own needs have been met, but to alleviate suffering at the expense
of your own is ideology, not love, and it makes no sense. Today,
though, I want to look at wise giving.
How do we choose charities wisely? How do we do the best we
can to do the most we can with the money we have to give? Here
are a few of my thoughts on this...
First of all, if you want to help other people, it is most
efficient to choose just a couple causes and devote your money
to these, rather than give a little money to many organizations.
This is because there is a cost to each organization for having
you as a donor. This is mostly a set expense, and it eats up
little of your donation if you give $1,000 annually to an charitable
organization, but a large percentage of smaller contributions.
For example, when you donate $20 annually to a cause, the
organization that gets your contribution will maintain your name,
and send out reminders for your contributions. This costs money.
If they are like most charitable groups they are also likely
to send regular mailings asking for special or extra donations.
In all, they may spend as much as $12 or $15 each year, meaning
the programs they support get as little as $5 in net benefit
from your contribution. It may seem nice to be able to support
50 causes with that same $1,000 by way of these small donations,
but the net effect can be that you only really put $250 to work
in those causes. Donate the thousand dollars to one organization
and if they spend $15 on mailings and donor costs, they still
have $985 to work with.
Which Charities Are Efficient?
How much of your contribution to a charitable organization
is actually used for programs? You can find out this and more
at the Better
Business Bureau Non-Profits Page. They list data like what
percentage of money raised goes to fundraising, how much the
chief executive makes, and how many people are employed by the
charity. Be aware, though, that what they call program expenses
can include expenses and wages for employees in the offices in
foreign countries where the money is destined to go, so the true
net to programs (which can be measured in many ways in any case),
can be substantially less than shown.
I find it a bit disturbing just how much money they pay the
top people in most of these organizations. I also find it upsetting
that so much of the money collected goes to marketing. I understand
the argument that you have to let people know you exist to get
them to donate, but the net effect of all of these organizations
competing for dollars is that a significant percentage of all
the money raised for good causes is diverted into advertising
One solution I've been considering is to send a check to my
favorite charities along with a letter requesting that they remove
me from their mailing list and put my name on their "do
not contact" list. That stops them from wasting money on
the usual ten mailings per year. I just have to remember on my
own if I want to make an annual contribution.
Helping people more directly is another approach to wise giving.
Sadly, my own experience tells me that we can rarely help people
with money, in this country at least. But occasionally people
really do need just a bit of cash to turn things around or to
get off the street. Good luck guessing which ones.
When working on this more personal and involved level, there
are some ways to be fairly certain more good than harm is done.
For example, you could share a healthy meal with people who are
living on the street, rather than giving cash. You can offer
a job rather than a handout. Or, to help animals, rather than
giving to a charity you might adopt a dog or cat from a shelter.
Over the years I have watched generous people "help"
others into all sorts of trouble, so wise giving is not just
a nice thought, but a necessity if you want to actually do good
with your generosity.