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  • How to Determine If a Charity Like Kony 2012 Is Worth Your Money

    In Charity, Kony 2012, Donations, Giving, Money, Impact, Social Responsibility, / 08 March 2012 / 0 comments

    How to Determine If a Charity Like Kony 2012 Is Worth Your MoneyIn the past couple of days, a charitable campaign called Kony 2012 has spread across the internet with a momentum normally reserved for cats, mostly due to a compelling 30-minute viral video condemning an unambiguously evil figurehead. It feels good to band together to fight something bad, but before you go handing your money to just any organization, no matter how noble their cause appears to be, it's worth finding out how they're going to spend it. Here's how to do just that.

    I'm taking CliffsNotes from Clay Johnson's previous post on tracking down how your charitable donations will be spent (maybe you're interested in his book), but applying them directly to Kony 2012. I also asked Clay a handful of questions about it via Twitter while I tried applying his techniques.

    Here's how the money susses out:

    Step one: Find Their 990

    Charitable organizations are required to fill out an IRS Form 990; this form details how an organization spends its money—a great starting point if you're thinking of giving them yours. As Johnson points out, this form is "far superior than a charity's annual report because there's less marketing inside of it, and more brass tacks."

    To find the 990, normally all you need to do is a minute or two searching your Google or Bing of choice. Doing so for the Kony 2012 campaign—specifically, the Invisible Children organization behind the campaign—will land you at the Financials page of the Invisible Children web site. (If Google's giving you trouble, you can also use GuideStar; a free registration will get you what you need for almost any non-profit.) Here's Invisible Children's 2010 990 form.

    Step two: Break down their spending

    Now that you've got the 990, it's time to see where the money's going.

    As a first step, Johnson recommends you find out how much a non-profit spends giving grants. The reason:

    If the non-profit is giving a substantial amount of its revenues as grants out to other organizations, then taking a look at those organizations and figuring out whether or not to give directly to them is an option worth considering. That may help your dollars get closer to the source of the problem you're trying to solve with your money, giving them more impact.

    In this case, you'll find that, of $13.7 million in revenue, Invisible Children spent 2.8 million on grants (about 20.4% of their considerable revenue). Already, Johnson suggests that this at this grant amount, you should "start looking for comparables"—i.e., other charities with the same goals, possibly including those Invisible Children gives grant money to.

    If you examine their expenses more closely (Part IX of the 990), you'll see that, beyond grant giving, not much money at all is going to direct services. Let's break it down a little:

    • $2.8 million goes to grants, as noted above
    • Over $1 million goes to travel
    • $851k goes to production costs
    • $357k goes to film costs
    • $244k goes to professional services

    Essentially, the flush non-profit spends as much on travel, film-making, and lobbying as it does on serving. That's generally a red flag. They also granted more money in 2009 than 2010, even though their revenue increased by over $4 million between the two years. You can read more from the Guardian.

    Next, find out how much the organization pays its executives. Again, from Johnson:

    If a non-profit is giving a substantial portion of its revenues to its executives, then it's not for me. I want my dollars going to solve problems not to line pockets.

    Page 7 of their 990 shows that Invisible Children spends between $84k and $89k on their three most compensated employees, which, according to Johnson, "looks about right for their funds raised." So no major strikes there.

    Third, Johnson says you should evaluate the practices of a non-profit beyond their accounting, and to do this, he recommends GiveWell, an organization that does in-depth charity research using a rigorous review process to determine the most effective charities. Invisible Children did not pass either of GiveWell's criteria for evaluation.

    That raises a red flag for me, but since Invisible Children has gotten a lot of attention lately, GiveWell actually has weighed in in a blog post titled "The Worst Killer of Invisible Children is Not Joseph Kony". GiveWell's critique, like other Kony 2012 criticism, mostly rests on the oversimplification of the problem as presented by Invisible Children, questioning whether money donated to "intervene in a complex, disputed situation that you don't have the context to fully understand" would be better spent on "a simple situation where all humanitarians really do agree"—namely malaria, which last year " caused an estimated 655,000 deaths, mostly among African children.

    So... What should I do?

    Things get complicated quickly when you start making value judgments on how to best help people, but where it is possible to make quantitative comparisons, you can learn a lot. I think most charities would agree that there are few wrong ways to donate, but if your goal is to have the largest impact per dollar donated, these numbers and analyses can be very helpful.

    You can certainly donate money to Invisible Children, and despite some criticism, it appears doing so isn't necessarily a bad thing to do. If your goal is to have as great an impact as possible in the lives of those directly affected by Kony, you may want to instead give to a comparable charity, or one that Invisible Child grants to. If you've been moved, as GiveWell puts it, to "care more about Africans", then maybe giving to a top-rated charity like the Against Malaria Foundation is an even better bet—where 100% of your giving goes to malaria nets.

    Either way, giving is good. Hopefully this guide has given you a better idea of how to do so and get your money's worth.

    Image remixed from The Noun Project.

    Thanks to Clay Johnson for his previous guide and for answering questions while I was writing this post.

  • The Best Ways to Donate the Junk Stored at Your Parents House

    In Charity, Donations, Clutter, Money, Shopping, Taxes, Social Responsibility, / 23 November 2011 / 0 comments

    The Best Ways to Donate the Junk Stored at Your Parents HouseIf you're at home over this long holiday weekend, whether it's your own or your family's, you might be looking through some old stuff and deciding on whether or not it's worth keeping. Figuring out what thrift stores and charities want can be hard, but there are a few ways to know if your stuff is worthy of the dumpster or the store.

    Photo by Kate Bingaman-Burt.

    What Can be Donated

    The Best Ways to Donate the Junk Stored at Your Parents HouseJust because you're in the giving mood doesn't mean someone wants to take your junk. There's no steadfast rule on what can and can't be donated, but it's good to keep in mind that whatever you want to donate still needs to have a practical use.

    For the most part that includes all forms of technology. People go to thrift stores for all sorts of things, vinyl records, old video games, outdated computers, musical instruments, and pretty much everything else you can think of. As long as it works, most donation centers will take it. There's almost always someone out there who still enjoys VHS tapes or 8-tracks.

    For newer electronics, many stores and non-profit drop offs have donation programs for recycling them or for sending them off to schools or people in need. This can be handy if your six-year-old computer still works fine, but you're upgrading anyway. We also highlighted a bunch of drop off locations a while back, many of which are still active.

    There are an entire subsection of thrift stores and non-profits that accept vehicle donation for working or non-working cars. In most cases, they'll even pick it up for you, so if you have an old beater you're tired of repairing but don't want to sell it, it's an easy way to get it off your lawn and help someone out.

    For things like books, DVDs, and CDs, libraries and schools often accept donations. You can call your local school or visit DonorsChoose to see what they're looking for.

    Photo by US Embassy.

    What You Shouldn't Donate

    The Best Ways to Donate the Junk Stored at Your Parents HouseFor the most part, you can use your best judgment on whether something can be donated, but most thrift stores won't accept these types of items:

    • Mattress/Box Springs
    • Infant Car Seats
    • Built in Appliances (dishwashers, cooktops, drop ins, wall mounts)
    • Baby Walkers, playpens, strollers, and swings
    • Window blinds, mini blinds
    • Magazines
    • On top of that, most places aren't interested in your broken furniture, old work clothes, or stained carpet. If you really want to give away your favorite old desk but it has a few problems, you might want to at least partially fix it up before taking it in. Otherwise it will likely go in the scrap bin. Many smaller places won't accept furniture, so be sure to check with your local stores and shelters before lugging down the 200 lb. dresser you want to ditch.

      That said, if the above items top your list of things to get rid of, you might still have some options. Mattresses and box springs, for instance, can often go to furniture banks or homeless shelters. Still, keep in mind you should only be donating a clean mattress. A big reason for this is bed bugs, but the overall gross-factor has an effect too.

      Photo by monkeysox.

      How to Donate it

      As we previously mentioned in our guide to cleaning out your closet, there are a lot of ways to donate your old stuff, including ways where you don't even have to get off the couch.

      For the bulk of your junk, your best bet is going to be a local thrift store. Places like Goodwill or the Salvation Army are good about taking a lot of different types of household items and usually keep a large drop-off area open for extended parts of the day. If you're too lazy or you don't own a car, many offer pickup if you can convince them it's worthwhile, or services like PickUpPlease and Charity Clothing Pickup will come by and grab your donations from your porch.

      Other places, like churches, schools, homeless shelters, or other non-profits are best surveyed beforehand to make sure they're interested in what you have. Since what you give them is given out for free to needy individuals and they typically don't have a lot of storage space, the policies differ from thrift stores.

      How to Write it All Off

      The Best Ways to Donate the Junk Stored at Your Parents HouseWhen you donate something, you'll be asked if you want a receipt. We've covered services like Lemon, Shoeboxed and Expensify before and these are all great tools for keeping track of your receipts. You can, of course, also just keep them in a shoebox or whatever method you prefer.

      Your donations are all tax deductible. Charity reductions are on Form 1040, Schedule A and when you donate the goods, they should let you know if they're a 501(c)(3), which makes them qualified for write-offs. However, donations between $250 and $500 require receipts. If you donate over $500, you'll need to fill out IRS Form 8283 with more detailed information. All the forms are pretty straightforward, but valuing your items can be a little more difficult.

      Thankfully, the Salvation Army has a breakdown of average item worth and TurboTax's ItsDeductible will figure it for you automatically. If you're donating larger items like a car or boat, your receipt should have the information on it already.

      In the end, it's best to remember the purpose of donation, you have something you don't need, so you give it away. It's not about getting rid of your trash. With that in mind, it's a simple process.

      Photo by Images Money.

  • SwipeGood Donates Your Loose Change to Charity

    In Charity, Donations, Money, Shopping, Credit Cards, Taxes, Social Responsibility, / 29 December 2010 / 0 comments

    SwipeGood Donates Your Loose Change to CharityIf you want to give to charity but don't have the time to think about it, free service SwipeGood will round up your change from every credit card purchase and donate that to the charity of your choice.

    In order to keep down your credit card fees, SwipeGood rounds up every purchase you make to the nearest dollar, adding the change from that purchase to your donation, which it makes at the end of the month (instead of after every purchase). If you have a specific charity you'd like to donate to, you can switch your charity any time you want, and they're always adding new ones. And, while in this case it's a good thing that the change from your purchases adds up quickly, you can always set a monthly limit for your roudups so you don't end up donating more than you can afford. Hit the link to read more.

    SwipeGood Donates Your Loose Change to CharitySwipeGood

  • Decrease Tax Burden by Donating Your Decluttering Purges

    In Charity, Donations, Saving Money, Recycling, Reuse, Money, Taxes, / 03 September 2010 / 0 comments

    Decrease Tax Burden by Donating Your Decluttering PurgesIf you're doing some major overhauling of your space, be it decluttering your closet or remodeling your office, it pays to skip the dumpster and donate as much as you can.

    Photo by Cristiano Betta.

    Financial and frugality blog Free Money Finance highlights the incremental benefit of donating your decluttering and remodeling castoffs. When they upgraded a front door they donated the old one to a local charity:

    My wife asked for and they gave us a tax receipt for the contribution. She then asked our door person what he estimated as the value of our door since we had no clue. He said $400.

    If we were, say, in the 28% tax bracket, the simple act of finding a charity that wanted, needed, and would take the door saved us $112 in federal income taxes. Not a fortune, of course, but it's $112 we didn't have before and that we earned for little effort. I'll take it!

    Whether you're replacing your office windows or swapping out your office furniture for something new, always check to see if there is a charity that needs your stuff. Not only do you get the satisfaction of knowing it's not just rotting away in the dump, it's going to help local charities repair homes, furnish non-profit offices, and other tasks. Have a tip or trick about donating to share? Know of a little known thing that makes a great donation? Let's hear about it in the comments.

    Save Money by Donating Things You Were Going to Throw Away [Free Money Finance]
 
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