End of the year charitable donations

We’ve made a number of posts on the topic of charitable giving in the past.  Since many charitable donations happen toward the end of the year, I will be posting a few additional guidelines and suggestions to keep in mind for those donating soon.  Most of today’s guidelines come via GiveWell, and are most helpful for people still trying to decide where to allocate some of their charitable funds (though some of the information will be helpful for everyone).

The more I read about GiveWell, the more impressed by them — they investigate relatively few charities, but their investigations are extremely in depth, and give a thorough evaluation of the effectiveness of the organization as well as other important factors (e.g., whether or not the organization currently needs money).  They are very transparent about their methods, as well.  The downside is that they address only a few types of charities, currently.

GiveWell has a Giving 101 guide to making wise contributions.  They also have a list of top-rated charities (about to change in December — the top-rated charities on the current list no longer need short-term funding, so keep watching for the updated list) and a list of celebrated charities they don’t recommend, with explanations of their rationale for each.

The Coalition for Evidence-Based Policy presents empirical evidence about social programs that work.  Some of these interventions are not connected to specific charitable organizations or programs, but many of them are.

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Link roundup

Trying something different from the normal, more extensively researched style.  Should link roundups become a regular feature?  Do you have any suggested links?

Greener Choices – A site from the publishers of Consumer Reports which is chock-full of information about environmentally friendly purchases and habits.  They’re very focused on quantifying impact and offer useful side-by-side comparisons and calculators.

Guide to food labels – What do food labels really mean?  Which ones are regulated?  Greener Choices also offers an Eco-labels center addressing overlapping issues.

Khan Academy and education reform – the online math-focused education website, Khan Academy, is radically changing the way some classes are taught and some students are learning.  Can this technology revolutionize education?  When, how, and for whom?

A Lever Long Enough covered innovative and effective ways to spread e-books and literacy across the world.

Charity rating systems still coming up short – I’ve written previously about problems with rating charities.  A recent scandal demonstrates how different rating methods currently used remain insufficient.

How to stop solicitations by mail – giving anonymously is not the only solution.

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staying off mailing lists: anonymous online donations

Here’s a situation I’m sure you can relate to if you’ve ever donated money:  First you feel happy for having contributed to a cause you care about.  Then you feel dismayed at the flood of resulting mail that comes pouring in from the organization you donated to and everyone they sell your contact information to.  Most of us don’t want to have to deal with the hassle of all this mail, or know that we’ve indirectly caused a tree massacre.

In the past, people have avoided the dead tree deluge by donating anonymously through a third party such as an attorney, a broker, or entity such as Fidelity Charitable Trust.  These days, another easy way to give anonymously is to donate via an online service.  JustGive and Network for Good both help users make one-time or recurring online donations. If you specify that you want to make the donation anonymous, both will keep your personal information private from the recipient of your donation (as well as the rest of the world).  In this way, you can avoid a deluge of mail.

JustGive charges a 3% processing fee;  Network for Good asks for a minimum 5% tax-deductible donation to their organization (4.75% for recurring donations; 3% for donations to non-profits that have subscribed to the site’s DonateNow service) on top of your donation.  These sites also make it easy to donate online to sites that don’t offer that option on their own websites.  Both sites are endorsed by American Institute of Philanthropy.  CharityNavigator has partnered with Network for Good and explains why, although I still haven’t found a convincing reason to prefer the more expensive of the two services.

If the organization you are donating to offers PayPal donations, PayPal’s fees are smaller than either of the above options, so long as the charity gets at least $3000 a month.  PayPal doesn’t allow anonymous donations, but you can also check the “no shipping required” box to hide your shipping address from the recipient.  However, according to the PayPal Privacy Policy,

If you are buying goods or services and pay through PayPal, we may also provide the seller with your confirmed credit card billing address to help complete your transaction with the seller. The seller is not allowed to use this information to market their services to you unless you have agreed to it.

If you do not pay by credit card (instead paying from your PayPal account balance), it sounds like you may be able to avoid sharing your mailing address with charities altogether.

Have you used any of these services, or found other ways to stay off of mailing lists when donating? What’s your favorite method?

Also, bolding main points of the post: obnoxious or good?  Please give feedback!

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crowdsourcing for a cause

How can crowdsourcing help people in need, or help further a good cause?

Crowdsourcing is a buzzword in industry right now, and large groups of people are earning money online doing everything from verifying business listings to designing logos.  There’s plenty of debate about whether crowdsourcing is fair to workers, and how to make these platforms most effective and fair.  But crowdsourcing be also be used in a number of not-for-profit situations.  The projects below are examples of several innovative ways that people are reaching out to help others via crowdsourcing technologies–and ways that you can, too.

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evaluating charities, part II

[Note: I started this post a number of months ago; some details might now be out of date.]

In a past post, I discussed sites that evaluate charities based primarily on financial metrics.  Before leaving that topic entirely, I wanted to to also point out that Guidestar has a bunch of information about charities, their structures, and their finances.  You can access the tax records from the past several years for many charities.  They help you verify an organization’s nonprofit status and do other research into organizations.  The site seems to be mostly aimed at people working in the nonprofit sector, large philanthropic organizations, businesses, and academic researchers.  It’s kind of clunky and ugly and harder to use than some tools, sometimes some data is sparse or missing, and they charge money for some services.  But if you want access to a lot more information directly from the company about their structure and finances, I’d check here first.  This may also be useful in using The Charity Rater, described below.

Moving on to other ways to evaluate charities aside from financial metrics, in the rest of this post I will be exploring GiveWell (based on empirical evaluation of results!), GreatNonprofits (kind of like Yelp), Philanthropedia (expert-based),  and The Charity Rater.  If you know of other charity evaluating organizations or metrics that I haven’t discussed in either post, let me know, and I’ll cover it in a follow up.

» Continue reading “evaluating charities, part II”

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is it better to donate to individuals or organizations?

Giving directly to individuals or to communities removes a lot of bureaucratic overhead.  But sometimes NGOs (non-governmental organizations) have expertise and resources that are necessary — or at least helpful in order to spend money well.  NPR’s Planet Money podcast recently looked at two cases of direct donations in Haiti. In one case direct donations to a community cause (school improvement) ended disastrously, but in another case (donations to a savvy wholesaler who’d been supporting her family for years before the earthquake), it seems as if an organization would have only gotten in the way of a mostly very good thing. In both cases, the results were complex and interesting.

Here’s the most recent report on all these cases: What your $3000 bought in Haiti.  This podcast summarizes and refers back to these earlier ones:

How foreign aid is hurting Haitian farmers: the initial description of the community that needed school improvement, prior to donations

Small business, big debts in Haiti: the initial description of Yvrose Jean Baptiste, wholesaler of chicken necks and other parts

For $3860, a new life: the follow up to the Yvrose story, post-donations

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Evaluating charities, part I

I’ve been wanting to post for a while about the different sites out there that evaluate charities and help donors decide how to best spend their money.  I’ve finally done the research, and I think I’m actually going to split this into at least two posts — possibly a longer series.  In Part I, I’m going to discuss three of the oldest and best known charity evaluators, all of which grade organizations in large part according to financial metrics.  I’m also going to discuss the controversy over using such metrics, and the pros and cons of these sites.  In Part II, I’m going to discuss some newer sites that are finding other ways to evaluate nonprofits.

I’m going to start by talking up front about the controversy involved with using financial metrics, because it’s interesting and it’s a good thing to keep in mind when reading about the sties below.  All of the evaluators I’m about to discuss measure, among other things, the amount of an organization’s income that goes toward administrative overhead.  The idea is that organizations should be efficient, and should be spending their money on the cause rather than large salaries, unnecessarily expensive resources, and general bloat.  While this idea seems reasonable up front, it has a number of critics.

» Continue reading “Evaluating charities, part I”

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Yesterday I attended TEDxBerkeley.  You may have seen TED talks online before, taken from the main TED event which used to be hosted in Monterey and is now in Long Beach (if not, I recommend browsing through them — there’s a lot of fascinating stuff there).  In the past couple years, TED, dedicated to “Ideas worth spreading,” has itself been spreading to a bunch of regional events that are locally organized.  The UC Berkeley event was subtitled “Doing the unprecedented,” and vetted its applicants for those interested in changing the world.  I went eager to hear talks on how others were changing the world, and hoping for some tips on how to do so effectively.

There were a number of interesting talks at the event, but a few stood out in particular from an effectivist viewpoint.  People spoke on everything from compassion, making progress toward ending conflicts, changing policy at the city level in order to save large numbers of lives, radically altering how the medical system works from the outside, and — perhaps best of all — effective philanthropy.

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cause marketing

It’s popular these days to market products by promising that a donation will be made for every purchase to some charitable goal. This is called cause marketing, and it sounds like a great thing, and it is, when we buy the same product we might otherwise buy, and a few extra dollars or pennies make in into the coffers of a good organization, well, what’s not to like?

There are a number of potential gotchas. Tim recently pointed me at a great resource warning of abuse of pink ribbon marketing campaigns called Think Before You Pink. While the entire site is worth a look, I’d like to start by talking about their list of critical questions you should ask before buying a product marketed with a pink ribbon.

Take a look, and then I’ll make a few comments on each of their points. Most of these points are relevant to any sort of product marketed with a cause.

First, how much of each purchase goes towards breast cancer? This is a great question. They give an example of a DVD that sells for $15 and ask if a fifty cent donation for each purchase is “enough”, and say it’s up to you to decide. I think that’s smart, but it’s not always easy to make sense of what’s reasonable.

Let’s take an example: If a manufacturer sells a can of soup that sells in the stores for fifty cents and donates three, that doesn’t look great. It might look better, though, if you realize the manufacturer was only getting twenty-five cents for the soup, and that the can of soup cost twenty cents to make. I have no idea if those numbers of realistic, my point is not that some particular campaign was bad or good, just that sometimes hard to make sense of what a reasonable donation is.

We’d agree with Think as well that you should look at things like “is there a maximum donation and what is it?”, “Where does the money go?” and “will the donation happen automatically if I buy the product, or do I have to do more work?” Great questions.

Think’s last point, about pinkwashing, is the most sobering. If you buy a product in part because of the donation that will go along with it, it’s very much worth asking if the product itself is doing more harm than the donation will do good.

I think they missed a question that’s just as important, though.

Would you buy this product anyway? Certainly if you are already buying a product, you like it, you know you’re going to buy more, and so on, and they offer a donation with every purchase, well, sure, this might be a good time to stock up. If you always buy one brand of cola or another and it’s pretty much a toss-up which you’d buy on any given day, and one of them offers a sensible donation, sure, go for it. But if, instead, you wouldn’t have never bought this product otherwise, you’re almost certainly better off sending the charity a donation.

Pink isn’t the only color of questionable marketing tactics, either. Some AIDS activists have expressed concern about the opaque finances of the “(RED)” campaign (which brands products with that label with a promise to donate an unspecified portion of each sale towards the Global Fund, which fights AIDS in Africa.) Opacity aside, it’s relatively clear that (RED) campaigns do generate some real money towards AIDS relief, lack of complete transparency aside, the real question is, is it a drop in the bucket compared to the money being shelled out.

One hard-to-measure (and therefore frustrating to those of us at Effectivism) effect of these campaigns is awareness, the idea that campaigns like this make people more aware of these diseases and, as a result, lead to increased funding for research and treatment of those ideas. It seems fairly clear to me that AIDS and breast cancer have been two of the most “active” pushes for awareness, and cause marketing has certainly been one element of that. AIDS and breast cancer both are near the top of various measures of research dollars per death. Now, research dollars per death is a terribly crude and often misleading measure of research dollar fairness, but it seems plausible (not proven) to guess that awareness has had some effect on research funding. Even if that’s true, though, it’s hard to be sure how much of that awareness can be attributed specifically to cause marketing (as opposed to other awareness activities), and to what extent that excess research funding represents additional research money rather than simply taking research money from other, perhaps more urgent causes. I in no way mean to minimize AIDS or breast cancer, here I’m only trying to analyze how good or bad a thing cause marketing is.

I do think that cause marketing can be a positive, valuable thing, I don’t mean to come off as negatively as this post might seem. I like the idea of businesses finding ways to participate in the greater community, and making a difference. I’ve used cause marketing in the past in my own business, offering a donation with every print purchase over a season, and I like to think that it was a positive for my customer, for the charity and for me, all at the same time. But you should, as a consumer, ask informed questions to make sure you’re not getting ripped off, and probably limit your charity-driven purchasing (for the most part) to goods you would have bought anyway.

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donation by text message

In the wake of the Haiti tragedy, a number of organizations have set up earthquake relief funds that have encouraged donations of $5 or $10 by text message.  The American Red Cross campaign has been the most publicized of these, having surpassed $20 million in SMS donations from the U.S. in the first five days (here are the current totals, broken down by state).  Other organizations accepting donations include Yele Haiti, the Clinton Foundation, the International Rescue Fund, and the International Medical Corps (details on how to donate to each here).

If you plan to donate $30 or less to the Haiti efforts, is SMS a good way to do so (mobile donors are allowed to donate more than once, up to $30 per campaign depending on your mobile carrier)?  The answer seems to be a qualified yes — it’s not a bad way to donate, at least if you’re donating to the Red Cross, and if you’re intent on donating to Haiti specifically.  Other organizations are more questionable as to their effectiveness (especially Yele Haiti), and earmarking funds (for Haiti or any disaster zone) is also possibly not the best idea.

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