So Where Do Our Funds Go?
By Natalie Van Hoozer
There is one topic that is always relevant to charity organizations: the use of funds. Many people who would like to donate money to charities hold reservations when donating because they are unsure where those funds might ultimately go.
We at NNCCF agree that these concerns are completely valid. Recently, four related cancer charities (one of which was a children’s cancer organization) were charged with fraud by the Federal Trade Commission.
As unfortunate as this occurrence is, it is an excellent reminder that, before you make your final decision about where to make a donation, it is wise to look at statistics about the nonprofit in question.
What You Can Do:
As the article Know How Your Charitable Donations Will Be Spent Before You Give by Clay Johnson states, a large amount of nonprofit data is available to the public, it’s like researching anything online! A Google search alone can reveal some helpful information about most organizations.
What Can Help You:
Specifically, the IRS Form 990 is commonly available, detailed, and has black-and-white information about how a nonprofit spends its money. Many 990’s are available with an Internet search, and there are also sites like GuideStar which provide 990s as long as one completes a free registration.
The legitimacy and impact of nonprofits is a common question, and there are many articles, websites, and organizations dedicated to explaining how to evaluate if a nonprofit is accomplishing goals that are in-line with how you would like your money to be spent. GiveWell.org is one such site, but many other sites are easily revealed through searching.
What If You Have Trouble Finding Information With a General Search?
If an organization’s information is not being made apparent with a 990 form or through other online resources, there are several other ways to obtain information. If an organization is just getting started or is small, that organization may not have a 990. They may also be small enough that they work with a sponsor organization. If there is a sponsor, it is wise to look into that organization’s spending to see where your money would end up upon donation. As a general rule, it is wise to try to understand the different organizations involved with the organization in question. Also, when considering small organizations, you may also want to try to contact the organization directly. The executive director or other staff person may respond to questions better than a large organization would.
In regards to NNCCF specifically, is important to note that 76% of our revenue goes to Programs and Services while 8% goes to Fundraising and 16% goes to Management and Development. If you would like to see this breakdown with helpful visuals, please take a look at our Annual Report on our website.