Giving Tuesday, the Tuesday after Thanksgiving is quickly approaching. Whether you intend to make a one-time gift on Giving Tuesday or to leave a charity a substantial sum in your estate plan, you want to be certain your generosity is going to a worthwhile organization.
There are too many sham charities to count, unfortunately. Moreover, rather than doing the most possible good, some seemingly reputable organizations waste donations on lofty executive salaries and oversized administrative budgets. So, how do you know whether a charity is worthy of your financial gift?
Your due diligence
According to reporting from CNBC, there are more than 1.6 million nonprofit groups in the U.S. alone. Many of these groups have charitable campaign arms that regularly seek to benefit from estate plans. Regrettably, there is no easy way to determine whether a nonprofit group is responsible or careless with its funding.
Before including a charity in your estate plan, you must exercise some old-fashioned due diligence. Consulting a watchdog group, such as Charity Navigator or Charity Watch, is a good place to start. These watchdogs give charitable organizations specific ratings in a number of areas.
Your attorney’s opinion
If you are making a small or one-time gift, you may have to decide which charity deserves it on your own. For large gifts, like designating a charity as a major beneficiary in your estate plan, you probably want to have the guidance of an experienced attorney.
Ultimately, your lawyer is likely to have the experience and resources to determine whether a charitable group is going to be responsible with your hard-earned money.