October 6, 2009

Checking out Charities

When you give money to a charity it is a good idea to make sure that the money is being used well. CharityNavigator.org and GuideStar.org are two sites that give you financial information on charities.


I find Charity Navigator easy to navigate and their information is pretty straight forward. However they don't seem to have that many charities. Charity Navigator gives a star rating to grade the charity based on their financials. Plus they also show you what % of the charity's expenses go to fundraising. A low star rating and a high % of money going to fundraising is not a very effective charity. It can help you avoid charities that seem to do nothing but spend money on fundraising like Disabled Veterans Associations which spends 94.6% of their money on fundraising and 1% on their executive's pay. A local TV station in Ohio looked into Disabled Veterans Associations with this report. Its easy to find charities on Charity Navigator. You can search by region, star rating and cause.


Guidestar has the full form 990 which the charity has to file with the government but you do have to register on the Guidestar site (free) to view the forms. Guidestar is harder to navigate and there isn't much there except the 990 forms. The 990 form details what the income and expenses are for the charity. The information includes specifics on where money they get comes from and what they are spending money on. Digging into the details on the 990's can give pretty interesting detail. For example you can find out from its 990 that the Goodwill in Oregon pays their CEO over $400k in 2007 and that they have half a dozen other executives making over $100k. By comparison the 990 for the Southern California Goodwill shows that they paid their President/COO a bit over $300k.

If you want a quick and easy picture of a charities finances then Charity Navigator is a good choice. If you want details on charities spending and income then Guidestar has the full 990 forms.

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