While many segments of the U.S. economy have been hard hit, none will feel the pain more than charities this holiday season. Charities across the country are certainly bracing for what is expected to be a very tight giving season. As more potential donors are focusing hard on keeping food on the table and a roof overhead, charitable giving is often the first thing cut from a family budget. For individuals on a budget looking for creative ways to contribute to charities, BBB’s Wise Giving Alliance is offering advice on keeping the spirit of giving alive this holiday season.
The current downturn in the economy is having a major impact on the bottom line of families and businesses and ultimately the well-being of charitable organizations. For example, The Red Cross has experienced a 30 percent drop in responses and contributions from new donors, and corporate donations are also on the decline. And more than 80 percent of the 180 food banks in a recent Feeding America survey said that they can’t adequately meet the demands of hungry people without reducing the amount of food or their operations.
“Charities invariably find themselves in a bind when the economy tanks; not only is there less funding, but there are more people that need assistance,” said Steve Cox, BBB spokesperson. “Donations of money may be hard for cash strapped families to provide, but there are many other ways people can support a charity and contribute to the season of giving. Even in times of hardship, donors are rich in opportunity.”
BBB encourages the public to explore alternatives to cash gifts, and is providing a “Top 5 Giving Alternatives” list this holiday season to help would-be donors in their decision-making process. The Top 5 list includes:
Toys, Food or Other Items
Many organizations can put “in-kind” gifts to good use, but there are points to keep in mind. First, the donor should contact the charity to find out what donated items are needed. Donors sometimes think any item they give will be useful to someone, but the truth is that broken toys are not welcomed by even the poorest children and families, and soiled or holey clothes will not sell in a thrift store. Disposing of unwanted or unusable “gifts” actually costs charities heavily in manpower and fuel costs.
Goodwill Industries reports that as personal finances shrink, more people are buying donated clothes at its stores. And additionally, sales benefit its programs to provide job training. Buyers should note though, that not all thrift stores equally benefit the charities whose names are associated with them. For more information about giving to charity thrift shops, plus information about related tax deductions, donors can go to www.bbb.org/charity.
Changes in tax rules beginning in 2005 have in many cases lowered the charitable deductions for car donations. Donors should check out the charity’s activities and find out how the charity distributes the proceeds from car donations, and how proceeds benefit those in need. In some cases, the charity may receive a flat amount or a small percentage of the car’s re-sale. See the BBB Resource Library at www.bbb.org/charity for additional information.
Donors can also volunteer their time this holiday season. The personal rewards can be great and can be as important to the charity as a cash contribution. Nevertheless, it’s wise to find out about the charity before making a commitment. Volunteering doesn’t have to involve direct assistance to those in need (like ladling soup at a homeless shelter). Assisting with office work or other behind-the-scenes tasks can be just as helpful. While the value of a donor’s time is not deductible, some out-of-pocket expenses directly related to volunteering, like transportation costs, may be.
Many charity Web sites feature “advocate” as well as “donate” buttons. Those charities are telling donors that their advocacy can help advance policies and practices that will contribute to their missions. Charities can’t promote political candidates but they can urge or lobby for public policies that further charitable causes. Donors may be asked to contact their representative in relation to certain legislation. Many charities also advise on how donors can further their programs through advocacy in local communities.
While there are many ways to give this holiday season, keep in mind that even a small cash gift often produces big benefits. For example, Feeding America says that $1.00 in cash can help bring up to $30 worth of food to those in need because the organization has economies of scale not available to the public.
For more advice on charitable giving, including BBB Wise Giving reports on more than 1,200 national charitable organizations, go to www.bbb.org/charity.