Wednesday, December 22, 2004

Checking Up on Charities

Have you ever wondered where the money you give to charities goes? How much of your contribution to a charitable organization is spent on its charitable mission and how much is spent on fund-raising and other administrative expenses? The two sites discussed below compile information on charitable organizations to help you make informed decisions on giving.

Charity Navigator provides information on approximately 3,400 organizations that have tax-exempt status under section 501(c)(3) of the Internal Revenue Code, and rates them using a four-star system. The ratings combine scores of several measures of organizational efficiency and capacity, based on the financial information each charity provides annually in its informational tax returns. Charity Navigator also provides peer analysis, financial statements, contact information, and privacy policies, when available, for each charity rated. Search for a particular charity or browse by category, region, or alphabetically by name. Free membership allows you to use a variety of additional tools. Tips & Resources and Articles & News do not require registration.

American Institute of Philanthropy publishes a triannual Charity Rating Guide & Watchdog Report, which informs donors about how approximately 500 national charities spend their money and provides current awareness on issues related to charitable giving. AIP's overall grades, ranging from A+ to F, are based on in-depth financial analyss of audited financial statements and other reports. Although full access to the Charity Rating Guide & Watchdog Report is only available with a $35/year membership, you can view AIP's Top-Rated Charities and their grades, an A-Z listing of the charities included in the Charity Rating Guide, Tips for Giving Wisely, and selected articles from the Watchdog Report for free. For example, see Seven Tips for Reducing Unwanted Mail and Phone Appeals.

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