Can I Still Use My Money for Good During These Challenging Times?

Use Money For Good

The need for generous people is at an all-time high right now. The pandemic has created economic and health care challenges that continue to stretch our resources. Millions of people are out of work, struggling to pay their bills and feed their families.

It can be challenging to figure out how to do the most good with many people in need of support. If you’re in the position to help others, these tips will help you think through your giving strategy at a unique moment when every donated dollar really does matter.

  1. Pick organizations you trust
    Social media has made it easier than ever to raise awareness about causes that need help. Many goodhearted people try to get involved directly by starting their own crowdfunding campaigns on sites like GoFundMe.
     
    Unfortunately, donating to these campaigns is often an inefficient use of your money. Crowdfunding is not subject to the same oversight as an official 501c3 non-profit charity. It is difficult to verify that your money reaches its intended target. Scammers always love to prey on people’s best intentions during a crisis like the recent hurricanes or wildfires.
     
    Unless you know the organizer of a crowdfunding campaign personally, it’s best to stick with well-established organizations. For extra security, you can check with watchdogs like Give.org or CharityNavigator.org to vet groups before you send money.
  2. Understand how your donation will be used
    When you donate to a large charity, a portion of that money could fund operational overhead like salaries and advertising. Does the charity spend 75% or more of their expenses on their programs & 25% or less on administrative overhead and fundraising costs? Some givers are disappointed when they find out that their money is helping an organization pay bills rather than directly helping a person in need.
     
    If seeing your money in action is part of your giving goal, you might feel better donating to organizations in your community such as churches, shelters, or local nonprofits. In addition to direct giving, you could also make an extra effort to support local businesses. It’s easy to see where the money you spend on carryout from your favorite restaurant goes: you get a burger, and the restaurant hopefully stays open.
  3. Focus your generosity
    The variety of problems we’re dealing with right now can make it difficult to decide how to give. “Decide” is an important word because you can’t donate to every single cause even if that is what your heart wants. Many long-term financial plans get thrown off course by short-term charitable impulses. Retirees living on a fixed income need to be especially careful that they don’t break their nest eggs trying to give too much.
     
    Remember your basic needs come first. If helping a charitable cause puts your finances in jeopardy, who is going to help you?
     
    Bring your giving down to size by starting locally. Large national nonprofits and charitable organizations have established donor networks they can tap during crises. Restaurants and food banks in your community probably don’t. You can make a difference in someone’s life tomorrow that could lead to positive change over time.
  4. Consider alternative ways to contribute
    Most experts expect levels of charitable giving to hold steady or slightly increase throughout the rest of the year. Volunteering, however, is likely to decrease significantly due to social distancing and other public health policies surrounding the pandemic.
     
    As valuable as your money is, your gifts and professional skills might be even more valuable right now. Volunteering as a remote tutor, graphic designer, or virtual office administrator could help an important cause keep its gears turning when your community needs its support the most.

For most of us when we see a need, our first impulse is to help. Even a few dollars a month can go a long way in some charitable organizations. Don’t overthink your decision too much, but always keep in mind this quote from Alfred Adler…

“Follow your heart but take your brain with you.”

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