Sunday, January 03, 2010


What's the right thing to do when it comes to donating money to charitable organizations?

A reader from North Carolina is torn about how to allocate the money he gives. He has categorized his typical giving into three groups - causes for the needy, political causes and "other," which encompasses contributions to organizations such as the U.S. Olympics Committee, the Boy Scouts and the United Services Organizations. He doesn't consider himself a religious person, and none of his money goes to a church, synagogue or mosque, but he has given to some church-supported organizations.

The question is how to divide what he can afford to give between those three groups. It's a tricky one because, like the rest of us, he doesn't have enough to give what he'd like to every cause he deems worthy.

"I know it boils down to one's individual preferences," he writes, "but can you offer a perspective?

"For example, let's say that I have $1,000 to give to whatever organizations I see fit," my reader continues. "I could give it all to the impoverished, the blind or any number of disadvantaged people in this country or others."

It might seem fair to divide the money equally among all deserving organizations, but each day's mail brings him about a dozen requests from such groups. If he were to split the $1,000 among all of the organizations he'd like to help, each would get about $10 before his money ran out.

"That's a lot of inconvenience and postage," he writes, "unless I pay online by credit card, which I'm disinclined to do."

In the bigger picture, however, my reader wonders if his money might have a greater impact in the long run if he donated it to political causes, individual politicians or organizations that promote those politicians.

"The elected politician's vote might benefit many more people over the long haul," he explains, "making my $10 contribution to a starving child in Africa almost irrelevant."

My reader's concerns show the importance of making thoughtful, intelligent choices in the causes to which we choose to donate. It's admirable to give to charity, but it's more admirable to do so intelligently, with awareness of who and what you're supporting. That the values of the recipient should match those of the donor is clear, but there's more to it than that.

Web sites such as do a good job of detailing how much of a charitable organization's budget is used for overhead costs. For those who want to dig deeper on not-for-profits based in the United States, Web sites such as provide access to a not-for-profit's 990 Form, a document filed with the Internal Revenue Service that gives a detailed breakdown of the organization's income and expenditures, such as the salaries of its top administrators.

As for his question, he's right that this is ultimately a question of individual preference. While it is praiseworthy to give to charity, there is no ethical imperative to do so _ someone who does not give to charity at all is not unethical. Assuming that one does give to charity, however, there is no ethical imperative to do so "fairly." The millionaire who leaves her entire fortune to the Girl Scouts has not acted unethically in not giving half to the Salvation Army.

To guide him in discovering his true preference, I suggested a simple test for my reader: Ignoring the process by which he decided what to give, he should simply total all that he has given and how it breaks down between the various choices. How comfortable is he with the outcome?

In 2009, my reader tells me, he gave "considerably more" than the hypothetical $1,000, and it broke down to 47 percent for the needy, 43 percent for political causes and 10 percent for "other."

There's nothing wrong with this per se. Upon looking it over, however, my reader found himself really uncomfortable with the current breakdown, "preferring by far to contribute to those who are in need."

The right thing for my reader - and other generous donors - to do is to distribute their donations in the way that leaves them the most comfortable with the outcome. No formula is better or worse than another. This is, as he says, about feelings.

In my reader's case, that means giving more to those who are in need. Another donor might invest more in political action.

They both stack up well by any ethical measure.

c.2010 The New York Times Syndicate (Distributed by The New York Times Syndicate)


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Paul Carpenter said...

There is some overhead cost associated with tracking donors. It is more efficient to give a few large dollar donations. Also by thoroughly researching a small number of organizations with similar missions, you can compare their spending priorities and decide which best suites you preferences.
As an example, organizations that help the impoverished in Africa: how much is spent on fund raising and administrative costs? How much is spent on high-wage American staff versus low-wage local staff? How much for on-site for education, medicine, disease prevention (such as insecticide treated mosquito nets) and community improvements (such as safe water systems)?