People constantly write in to ask us how we picked the charities that people can donate to on Tab for a Cause. The answer is that we did our homework to find charities that are important to our tabbers and do an amazing job of using new-tab-page money to make the world a better place. But with so many thousands of charities out there, how did we possibly narrow it down? Can our methods be used by anyone who wants to find a charity that is meaningful to them and needs their help? Absolutely!
A Nation of Giving
Each year, Americans are giving more and more money to charities. The average annual household contribution is almost $3,000, and in total, $335 billion went to charity in 2013 alone, up 4.4% from 2011. Even young people (when they aren’t busy choosing the most appropriate filter for their selfie) find time to give back . It turns out they’re actually leading the pack (see our previous post on millennial giving!). But with so many nonprofits, charities and volunteer programs, how can we find a cause that both inspires us personally and uses our money effectively? Thankfully, these tools are here to help:
GiveWell is a non-profit evaluator that focuses primarily on the cost-effectiveness of charities. Its goal is to let you know what will give you the most bang for your buck. But what does this mean, exactly? Well, first of all it doesn’t look at things like the charity’s overhead spending or its specific cause. It’s all about how far each dollar goes. Using this criteria, GiveWell recommends a few charities each year, like Against Malaria and the Deworm the World Initiative, in 2014.
As you probably noticed, both organizations focus on developing nations, and this is a general trend in GiveWell’s recommendations. This is because one U.S. dollar goes a lot farther in the developing world than practically anywhere else. Lots of charities found closer to home are nowhere near as cost-effective as those far away, and therefore aren’t recommended by GiveWell.
It’s also important to know that GiveWell does not try to evaluate a large number of charities. Instead, it seeks out outstanding or extremely promising organizations that need your help. The term for this is “room for more funding” and it means that the specific charity is awesome and ready to grow, with your help. Put another way, Holden Karnofsky of GiveWell argues that once a cause has reached its goal, say, eradicating smallpox, there is no more room for funding it.
Next up is Charity Navigator, a tool that evaluates about 5,400 charities in the United States and hundreds of organizations with operations abroad. Like GiveWell, Charity Navigator rates charities based on financial parameters but in this case uses IRS Form 990 to judge financial health, accountability and transparency. It is limited in scope as it only looks at the charities that make over $1 million in annual revenue – about 6% of charities nationwide. It may seem that a lot of organizations are being left out, but keep in mind that these 6% collect 94% of revenue that comes into the nonprofit sector each year. In other words, they are the heavy hitters most people give to.
Charity Navigator is interesting because it is constantly rethinking and re-evaluating itself and its rating system. Every few years it announces a revamped approach to rating charities without ever straying from its main focus of accountability and transparency. In a nutshell, it takes a more holistic approach to evaluating organizations by looking at finances, goals and results. You can navigate categories like “animals,” “health,” “education,” and “religion,” and find ratings and summaries of each charity’s effectiveness through easy to read graphs and statistics. The site is extremely user-friendly and caters to the individual looking to make a difference.
The final tool we’ll look at is the Massive Open Online Course (or MOOC) made and published by laaf.org. It’s called Giving 2.0 and it’s taught by the founder of the company, Laura Arrillaga-Andreessen. Giving 2.0’s credo is that there are no best charities, at least not in an absolute sense. The course helps you give according to your own personal interests, coupled with the charity’s effectiveness and impact. Laaf is more personalized than the websites we discussed above, but it also requires more work to use successfully.
Instead of providing ratings, evaluations and top ten lists, Laaf takes us step by step through the process of finding and donating to a charity. The main idea is that we all want to give back in different ways. So instead of finding the overall “best” charity, Laaf asks us to start by thinking very deeply about what is important to us and why. Then you do research in that field, find out what organizations exist and what they’re doing. Finally, you look at a few choices that stand out to you and rate them according to your values and goals. Laaf helps you make sense of tax forms and budgets, but also of missions and impact. It is by far the most personalized and all-encompassing tool, and when used well, can revolutionize how a single user approaches giving.
The “Best” Charity
If there is one thing that we can learn from this wide variety of tools, it is that there is no “right” way to give.
Peter Singer wrote in his 2013 New York Times article “Good Charity, Bad Charity” that certain causes are inherently more deserving of our money than others. His famous example involves donating to a developing nation to cure preventable diseases vs. donating to a museum to build a new art wing. To be sure, the question of “how much is this money really going to make the world a better place?” is one that we should always have in our minds. For some like Singer, it is the only question.
However, how and why we give are not necessarily dictated by the number of people saved per dollar; there are emotional, practical, cultural and even geographical factors to keep in mind. Perhaps we’d rather donate our time to a charity in our neighborhood, to support our community, or maybe we have a passion for the arts and therefore opt to send money to the local public school district to help fund music classes.
Whatever the reason or cause, all giving is good. So let’s redefine the idea of “best” charity – it’s different for everyone, and that’s great news! We can’t all support the same causes in the same ways. Whatever gets us excited and involved, whatever inspires us, that’s the best charity, whether it’s helping build wells where they’re needed or serving at a local soup kitchen. After all, real impact comes from continued involvement and support of a cause rather than a single isolated donation. Be informed, and give well according to your values and goals and the world will thank you for it.
Written by Alessandra Aquilanti, Contributing Writer