Choosing a Charity

Choosing a Charity

Slide1If you are a young investor, chances are that you?ve considered the possibility of giving to one or many charitable organizations (Jason Hartman supports the Leukemia and Lymphoma Society, for example). There are many benefits?support a cause you believe in, develop lasting professional and personal relationships, practice investing in a safe and giving environment, and impact the world beyond, leaving an important and lasting impression. But before you make these significant decisions, there are a few things to consider.

First, get a little technical with your charity. If it isn?t one that?s often in the media and therefore likely legitimate, ask to see federal 990 forms to prove the charity?s status as a nonprofit. Also, inquire about the annual report. Real charities will have these documents available and will be willing to provide them to you. Of course, you should also look for nonprofits that have working phone numbers and email addresses, current websites, and listed short and long term goals.

Check sites like the Better Business Bureau and for more information, and ask around for recommendations from people or businesses you trust. Also consider going local with your charitable donation. This way, you support your local community and build relationships that may benefit (though this shouldn?t be your primary goal) your further investment goals.

After you?ve established the legitimacy of a charity, look further into the work they do. If you?re interested in researching in order to cure something, choose a charity with this as its focus. If you?re fonder of charities actively completing projects in the community, select an organization you know is doing this. What, exactly is your money going toward? Fun runs? New houses? Lab research? Knowing the specifics of how your charity makes a difference is key to making an informed decision.

Remember, not all charitable givers are wealthy?in fact, most are not. According to Indiana University?s Center of Philanthropy, those earning less than $50,000 per year are donating 4% of their income to charity, while those earning over $100,000 give only 2%. If you feel that charity could be a regular part of your investing, make annual or monthly donations and think of them as reoccurring payments. Or, ask that others make donations in your name in lieu of gifts to you. Your donation, no matter the size, is a worthwhile investment and should be treated as such?do your homework, donate, and enjoy that warm feeling we know you?re getting. (photo credit: net_efekt via photopin cc)

* Read more from Young Wealth
A Workingman’s Holiday
The Importance of Active Consumer Advocates

The Young Wealth Team