Tips for Charitable Giving this Holiday Season

December is already here, if you can believe it, and for nonprofits around the country that means it’s the giving season. Some donors give because the holiday spirit moves them while others are looking for a last-minute tax break. Either way, this is a critical time for these organizations. Our friends at NeonCRM did some fundraising research about the giving season and found that nearly one-third of annual giving occurs this month. Their study found some other interesting statistics as well: 28% of nonprofits raise up to half of their annual funds from their year-end donation campaigns. And most surprising to me was that while more than half of nonprofits start planning their year-end appeal in October, nearly two-thirds of donors do zero research before giving. So, while many people plan on giving this month, they aren’t looking into the groups they donate to. The research can be a little overwhelming if you aren’t familiar with nonprofit operations, but there are a few tips you can use to ensure your donation goes to a worthy cause.

Use an Online Tool to Help You

If you start searching online for which nonprofits to donate to, you’re likely to get inundated with a lot of lists, filled with various metrics that all are supposed to assure you that the organizations listed are the right choice for you. These metrics tend to be as seasonal as diet trends.Overhead expenses, for example, went from being evil to ok again, to now regarded with skepticism. Sites that rate nonprofits tend to use a more holistic approach. For instance, Charity Navigator measures administrative expenses, fundraising efficiency, and how fast expenses are growing—and combines that in to one financial score. Looking at the bigger picture is a more honest way to judge an organization, rather than based on one or two items in a list. So try to find an online tool to help guide you. Choose a tool that looks at organizations as a whole and objectively evaluates them.

Find Transparency   

Another great thing that Charity Navigator looks at is transparency. This might even be a more important measurement than financials.Nonprofits already have a lot more transparency than for-profit organizations but can go above and beyond what is required to reassure their community that they’re doing their best. Here in our (dog-friendly) office, we’ve held events to support the Idaho Humane Society, which is one of our favorite organizations. According to Charity Navigator, they have a perfect accountability and transparency score. The Idaho Humane Society has published a conflict of interest policy and a whistleblower policy, they have a process for determining CEO compensation, and they have audited financials prepared by independent accountants. If a nonprofit is fully transparent about their operations, you can feel better about giving to them.

Think Locally

Our last piece of advice is to find a local organization. Large nonprofits do great work, and this isn’t to say you shouldn’t donate to them, but it you’re unsure who to donate to, look around the neighborhood. What issues matter most to your community? Smaller organizations are going to be very grateful to receive a new donor, and you will likely have the opportunity to attend events and meet the people working behind the scenes. These relationships are even more valuable than a one-time random donation. These organizations need the support of their community to help them in the work they do.

So as the giving season gets into full swing, take note that the decision to donate might be a little impulsive for you but has been a planned operation for months for most nonprofits. This is such an important time for them; their budgets can be very dependent on the donations they receive this time of year. Think about what issues are most important to you and see if there are any hidden nonprofit gems in your community. Take a few minutes to research a charity before you donate and feel confident that your donation is making the impact you want it to.

Here at Cougar Mountain Software, our goal is to help nonprofits around the country have unparalleled success. We invite you to join us in that however you can. Have a happy holiday season and a prosperous new year.