We have been looking at year end giving tips--most of which usually cite the tips from Charity Navigator. Their discussion is much more in depth than the summary here so make sure to review their listing. Our focus has been on how you as the charity can put your best foot forward. The last three...
8. Look at the charity's financial health. Review the last three years of the Form 990. Generally you would expect to see 75% of the expenses spent on program and 25% on administration and fundraising. I was pleased to note that Charity Navigator affirms that well run organizations need to spend money on raising funds and the administrative functions of running the organizations. I am always wary of charities who proclaim that 100% of your donation goes directly towards the program. A sustainable organization spends money to continue fundraising and has a solid administrative foundation. You should also have money saved for the future.
We sometimes find that smaller nonprofits only allocate direct program costs to the program category. You should have a reasonable method for allocating occupancy costs, office costs, and other costs to program, administrative, and fund raising.
9. Concentrate giving. If you have spent time evaluating a charity, give more money to that charity instead of spreading smaller amounts among multiple charities. Charities spend time and money processing your gift and following up with future requests, newsletters, etc. The cost to process a $10 gift will be likely the same as to process a $100 gift. Overall, concentrating your gifts saves charities money. This is an interesting perspective. As a charity, you may be thinking that you welcome that $10 gift because you can demonstrate success in increasing that first $10 gift to a larger gift in the coming years. If that is not the case, what can you do to engage donors so that they want to invest more with your organizaiton in the coming years?
10. Make a long term commitment. When a donor sees the value of their partnership with the charity they will want to be engaged for the long run. Do your donors feel like partners? Similar to the prior point--how can you further engage your donors?
These posts have been aimed at helping you see your charity through your donor's eyes. In the end, you are the steward of your donors funds. By working in partnership with you, they hope to see impact in the community. The more clearly you demonstrate this, the more they will want to partner with you.
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