Every year, as tax season nears, there is an abundance of emails, charts and graphs that make the rounds of the internet talking about several larger charities and how much of your money that is donated goes to actual charitable services and how much winds up in the pockets of the CEO or company principals attempting to steer potential donors away from inefficient charities.
“As you open your pockets for yet another natural disaster, keep the following facts in mind; we have listed them from the highest (worse paid offender) to the lowest (least paid offender)."
"The worst offender was yet again for the 11th year in a row.
Their CEO receives $1,200,000 per year plus use of a Royal Royce for his exclusive use where ever he goes, and an expense account that is rumored to be well over $150,000."
"Only pennies from the actual donations go to the UNICEF cause - less than $0.14 per dollar of income."
2. The American Red Cross
"President and CEO Marsha J. Evans' salary for the year was $651,957 plus expenses."
3. March of Dimes
“It is called the March of Dimes because only a dime for every 1 dollar is given to the needy.”
4. The United Way
“President Brian Gallagher receives a $375,000 base salary along with numerous expense benefits. “
“CEO and owner Mark Curran profits $2.3 million a year. Goodwill is a very catchy name for his business. You donate to his business and then he sells the items for PROFIT. He pays nothing for his products and pays his workers minimum wage! Nice Guy. $0.00 goes to help anyone! Stop giving to this man. “
In fact, I found out in a survey commissioned by Blackbaud, which provides software to nonprofits, that not only are Baby Boomers the largest group of "donators" numerically, with 51 million individuals comprising 34% of the donor base, they are also the largest contributors, giving an estimated total of $61.9 billion per year (43% of all the dollars donated).
Starting with Snopes, probably the best known rumor examination website and digging deeply into the Better Business Bureau, Charity Navigator, Charity Watch and the American Institute of Philanthropy I found that the state of charitable organizations is not as awful as you would think.
In fact, it is quite heart-warming.
I will attempt to present accurate and up-to-date information about the named charities below.
When deciding which charities to donate to, experts consider an important factor to be the "efficiency" of these organizations — that is, what percentage of the monies taken in by a given charity goes to funding its mission rather than being eaten up by costs such as fundraising activities, salaries, and other administrative overhead.
Charitable groups considered the best generally spend 75% or more of their budgets on non-profit and donation programs, spend $25 or less to raise $100 in public support, do not hold excessive assets in reserve, and receive "open-book" status for disclosure of basic financial information and documents.
The efficiency information is derived from the Charity Navigator web site, the GuideStar web site and Forbes magazine's November 2009 special report on the 200 Largest U.S. Charities.
Salary information is taken from Schedule J (Compensation Information) of the various charities' IRS Form 990 filings, an annual reporting return that certain federally tax-exempt organizations must file with the IRS which provides information on the filing organization's mission, programs, and finances.
Strangely enough, much of the information presented in the emails l spoke about above was inaccurate back in 2005, and it has grown only more so in the years since then, resulting in a misleading and very outdated view of various charities.
Goodwill Industries International is not a business that takes in donated items and resells them for a profit.
It is a not-for-profit organization that provides job training, employment placement services and other community-based programs for people who have disabilities, lack education or job experience, or face employment challenges.
Goodwill raises money for their programs through a chain of thrift stores which also operate as non-profits.
Goodwill Industries International is America’s second largest nonprofit, according to Forbes.com’s annual “America’s 200 Largest Nonprofits” list.
Goodwill Charitable Commitment is 88%. The charitable commitment statistic calculates how much of total expense went directly to the charitable purpose as opposed to management, certain overhead and fundraising.
Their Fundraising Efficiency is 99%. The fundraising efficiency ratio shows the amount of contributions left after subtracting the cost of getting them.
The CEO of Goodwill Industries International is not Mark Curran, nor does he make $2.3 million a year.
The current President and CEO of Goodwill is Jim Gibbons, who in 2011 received a total reported compensation of $725,000.
Program Expenses or the percent of this charity’s budget spent on the programs and services it delivers is over 90%.
Their administrative expenses are 4%. Their fundraising expenses are just over 5% and the fundraising efficiency is only 23 cents of each dollar of donations received.
United Way Worldwide
Who cares what the CEO of this charity makes?
They are considered a 4 star charity with a 66 rating from Charity Navigator.
Their Program Expenses or the percent of this charity’s budget spent on the programs and services it delivers is also over 90%.
Their fundraising expenses are under 3% and the fundraising efficiency is only 3 cents of each dollar of donations received.
March of Dimes
Charity Navigator rates the March of Dimes' efficiency at 64.6%, a fair bit lower than most of the charities mentioned here, but much higher than the 10% figure claimed in the e-mails floating around the internet.
Charity Navigator rates this organization at 63.3 efficiency with over 90% of their expenses going to charitable functions.
This means that only 6 cents of each dollar is used for salaries and administrative costs.
Ronald McDonald Houses
Ronald McDonald House charities operate at local levels in dozens of different metropolitan areas in the U.S. with varying levels of efficiency.
Charity Navigator rates the efficiency of the parent organization very highly at 89.5%.
St. Jude Children's Research Hospital
Charity Navigator rates the efficiency of St. Jude Children's Research Hospital very high at 70.3%, but considerably lower than the 100% figure claimed in the traveling emails.
The information presented in the circulating emails is outdated, as W. Todd Bassett stepped down as National Commander of The Salvation Army in April 2006.
The current National Commander of the Salvation Army (since 2010) is William A. Roberts.
The Salvation Army is not required to file a Form 990 with the IRS because it is primarily a religious organization, but according to the Better Business Bureau (BBB), Roberts' last reported total annual compensation was $126,920, much higher than the $13,000 reported above.
Forbes rates this organization's efficiency at 82%, a fair bit lower than the 93% figure claimed in the e-mails.
There really is some good in this world after all.
Sure there are some CEO's making big bucks running big organizations but that holds true for the entire corporate world and being the figurehead for a company whose success is based solely on how many donations they receive is very tough work.
Year-End Giving Survey
To gain a better understanding of giving trends for the 2013 year-end giving season, I found two surveys on Charity Navigator that you might find interesting: one targeted at donors and one for charity representatives.
The surveys explored the:
- Predictions for year-end giving (will it be greater, less than or the same as last year)
- Importance of year-end donations and online giving to the charities’ bottom line
- Issues that are most important in selecting a charity
The findings may surprise you!
Click here to "Review the Results Now."
Here are some very interesting facts about the general population of the United States and how generous, obliging and unselfish we can be as a whole.
Charity Giving Facts
- Contributions are deductible in the year made. Thus, donations charged to a credit card before the end of 2013 count for 2013. This is true even if the credit card bill isn't paid until 2014. Also, checks count for 2013 as long as they are mailed in 2013 and clear, shortly thereafter.
- Middle-class Americans give a far bigger share of their discretionary income to charities than the rich. A report by The Chronicle of Philanthropy showed that households that earn $50,000 to $75,000 give an average of 7.6% of their discretionary income to charity, compared with an average of 4.2% for people who make $100,000 or more.
- Individuals spent less time volunteering in 2012, but nearly 26.5% of the adults in the United States volunteered with an organization that year. Volunteers contributed 12.7 billion hours in 2012, worth an estimated $259.6 billion.
- The average person makes 24% of their annual donations between Thanksgiving and New Year's, according to research from the Center on Philanthropy.
- Women of the baby boom and older generations give 89% more than their male counterparts, Women's Philanthropy Institute research shows.
- After a successful inaugural effort during the fall of 2012, a unique giving experience will took place again this year on December 3rd, 2013. It is called #GivingTuesday and it is catching on across the country and around the world. This movement aims to set aside a day dedicated to giving, similar to how Black Friday and Cyber Monday have become days that are synonymous with holiday shopping.
If you found today’s blog helpful, interesting, or even funny, I bet your friends would too.
It's easy to tell them about it.
Forward it on to them or just email them my blog link at www.survive55.com.
The more Baby Boomers we can help, the better place we make this world !!!