Tis the season for giving: A guide for how to give, even a little
Christmas is over, but giving season for nonprofits is just starting to peak.
The end of the calendar year is when nonprofits make appeals far and wide to attract donors — in part because of holiday traditions or, for some, tax advantages. Nonprofits get about 30% of their annual donations in December — including 10% in the final three days of the year — according to marketing agency Nonprofits Source.
“This is one of the busiest times of the year for us as we assist donors with their year-end giving,” said Erin Musgrave, a spokesperson for the Silicon Valley Community Foundation.
Many potential donors don’t realize how much nonprofits value even small gifts, especially local organizations that meet community needs. And nonprofits and industry groups warn that donations are down this year, so gifts now could help them a lot.
Only 11% of Americans itemize their taxes, which allows them to claim significant tax deductions for charitable donations. That means most Americans don’t give in December for tax reasons.
“They’re thinking about the organization in their community that’s having an impact and digging deep and giving,” said Chuck Collins, director of the Program on Inequality and the Common Good at the Institute for Policy Studies.
As you watch commercial appeals and sort through donation requests, here are some things to consider:
Where should I donate?
Experienced donors often have a short list of criteria they use to help select nonprofits to support. It could be organizations that serve the area where they live or specific causes or issues with which they have a personal connection.
A question to ask yourself is: “What are the issues or communities that are important to me and where do I want to make a difference?”
A great way to find out about organizations in your area is to ask your friends, coworkers and neighbors. They may have interacted directly with a nonprofit. For any topic that is important to you, an organization in your area is likely working on it.
Another potential consideration is check if your employer will match donations to the nonprofit you want to support.
Do I have to give now?
No, simply put.
First, there’s no obligation to give to nonprofits. Many people make a difference in their communities — donating blood, volunteering with their fire department, caring for neighbors and myriad other ways.
Second, many nonprofits actually prefer for donors to set up automatic monthly donations, even in very small amounts, rather than giving a lump sum at the end of the year.
How do I know I’m making a difference?
Some donors say they want their dollars to go directly to the nonprofit’s work and not to pay for rent or salaries. This perennial view of wasteful “overhead” spending has some draw backs, though to be clear, donors have good reason to assess the organizations they support carefully.
But a useful data point comes from the nonprofit ratings agencies themselves. Starting ten years ago, the agencies like BBB Wise Giving Alliance and GuideStar, now part of Candid, teamed up to challenge the idea that the best way to measure the value of a nonprofit was the portion of its funds spent on administrative costs and fundraising.
Michael Thatcher, the president and CEO of Charity Navigator, which overhauled its rating methodology in September, advises that donors consider the organization’s impact and whether it’s achieving its mission.
What if I don’t have a lot to give?
People who study philanthropy and advise donors like Vanessa Lee, a program officer who coordinates giving circles at the Chicago Foundation for Women, emphasize that giving back is not the purview of the ultrawealthy.
“It’s not like you have to have millions of dollars to be a philanthropist,” said Lee. “You can do this at $10 a month.”
Additionally, donations from low- and middle-income people, who give smaller amounts, usually go directly to nonprofit organizations, in contrast to many of the wealthiest donors, Collins of the Institute for Policy Studies said.
