‘Tis the season of giving, and many seniors will make end-of-year contributions to charitable organizations. Whether you give out of the goodness of your heart, because you need a tax deduction, or a combination of the two, it is important to do your research before you reach into your wallet in order to protect yourself and your money.
Unfortunately, fraud is rampant in some organizations that claim to be not-for-profit charities, and there are people who look to take advantage of seniors’ generosity and kindness, especially this time of year. There are a few simple precautions you can take before making a donation to ensure your money is being spent the way you intended.
Research before you give
Charity Navigator (www.charitynavigator.org) is a great website to consult before giving away your hard-earned dollars. A 501(c)(3) public charity itself created in 2001, Charity Navigator uses a team of professional analysts to examine tens of thousands of financial documents from not-for-profit organizations in the U.S. The analysts synthesize their findings to create an impartial rating of the non-profit, examining the charity’s performance, financial viability, accountability, and transparency.
With reports assessing over 8,000 charities in the United States, Charity Navigator shows prospective donors how their money will be spent, how well the not-for-profit has maintained its programs and services over time, and the organization’s level of commitment to good governance, best practices, and openness with information.
Other tips for safer charitable giving by seniors
Charity Navigator has a few other specific tips for seniors who are considering making a charitable donation this holiday season.
Don’t succumb to pressure tactics.
Reputable charities do not employ high-pressure tactics to raise money for their mission. They simply do not need to take that low-road fundraising approach if their high-quality work and financial health can speak for them.
Verify any claim that you’ve contributed in the past.
If you receive a phone call or a letter suggesting that you have donated in the past, but it does not sound familiar to you, make certain that you confirm the claim for yourself. Review previous checkbook entries or old credit card statements to validate that you have in fact given to the organization before.
Do not feel compelled to give because you receive a gift.
Return address labels, holiday cards, a nickel glued to a card…just because a mail solicitation gives you a “free gift” does not necessarily mean you should reciprocate with a contribution. So-called “sweepstakes” that require a contribution to enter are especially alarming red-flags. Again, this type of inefficient and deceptive fundraising tactic will never be used by a reputable non-profit organization.
Be careful of imposters.
A common scam employed by fraudulent “fundraisers” is to use sound-alike names to fool prospective donors into thinking they are giving to a legitimate charity. Always confirm the charity’s name to be certain you are giving to the specific organization you think you are giving to.
Hang up the phone…
Do not give money (or your credit card information) over the phone to tele-solicitors. While some legitimate non-profits do use third-party, for-profit fundraisers to make calls on their behalf, this also is a common technique used by scammers. If you receive a phone call and you are interested in giving to the non-profit the caller says they represent, ask the fundraiser to mail you information about their organization, and then do your own research on the charity.
…then send your donation directly to the charity.
Once you’ve done your research, if you feel comfortable with the organization, send a check directly to them by mail, which ensures 100 percent of your money goes to the charity and not to any third-party, for-profit fundraisers they utilize. Never mail cash as it can be lost or stolen. Also, contributing by check or credit card provides you with a receipt of your donation, which can be used to authenticate your tax-deduction.
If you or a loved one has benefited from quality services provided by a continuing care retirement community you may want to consider a donation to support the organization. Most CCRCs are not-for-profit organizations who maintain an endowment fund to help provide services to their residents.
Make sure that your donation is tax-deductible.
Before donating your money to any organization, be sure it is a 501(c)(3) charity, which means the group has filed the necessary Internal Revenue Service (IRS) paperwork registering it as a U.S. non-profit and enabling its donors to deduct contributions from their taxes. Note: all of the charities that have been assessed by Charity Navigator are certified 501(c)(3) entities.
Research the charity before you give.
As previously mentioned, it is wise to review the organization’s finances, verifying that it is directing at least 75 percent of its budget to the programs and services it exists to provide. You can check these stats on the Charity Navigator website.
Tell the charity not to share your personal information.
Seniors can get caught up in a vicious cycle when they give small donations to a lot of different charities. Some organizations sell or trade the personal information of small-time donors to other non-profits, and before you know it, your mailbox is packed with contribution appeals from other charities. Many reputable organizations will allow you to opt-out of their information sharing initiatives, so be sure to specifically tell charities not to share your information with any other entity.
A worthwhile endeavor
There are literally thousands of non-profits–large and small– in the United States that can put your contributions toward worthy causes. With that many options, seniors should have no difficulty finding a charity that matches their giving goals and interests. And by using these simple best practices to protect themselves, seniors can begin to leave a philanthropic legacy during their lifetime.
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