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Donations big or small matter. Do it right

Many of us give when we’re asked — S$2 for flag day, S$10 to a charity a friend likes, and plenty more. Over the course of a year, those small amounts add up.

Donations big or small matter. Do it right

Many of us give when we’re asked — S$2 for flag day, S$10 to a charity a friend likes, and plenty more. Over the course of a year, those small amounts add up.

You can have greater impact, though, by choosing causes that matter to you and donating strategically.   

HOW MUCH YOU ARE DONATING

Singaporeans are indeed generous. When the National Volunteer & Philanthropy Centre asked about giving, 90 per cent of Singaporeans said that they have a strong intention to donate money.

Even though the percentage who donate dropped from 91 per cent in 2008 to 79 per cent in 2018, the average amount doubled over that timeframe and people donated more than S$2 billion last year.

Many of those donations are tiny, with nearly 80 per cent saying they make micro-donations.

Along with benefitting non-profits, these donations help the donor, too.

As University of British Columbia professor Elizabeth Dunn and Harvard University professor Michal Norton noted in their book, Happy Money: The Science of Happier Spending, individuals who spend $5 on someone else report being happier than people who spend $20 on themselves.

Donors feel wealthier, report better health, and light up the reward centres in their brains.

WHERE YOUR DONATIONS COULD GO 

There is no shortage of organisations here to which you may donate.

The Ministry of Culture, Community and Youth reported that there were 2,277 registered charities in 2018.  

The challenge, as the Commissioner of Charities explains it, is that from time to time, you may be approached for donations to support various charitable causes.

While most of these needs are genuine, the Commissioner of Charities observed that it is always good to be discerning in responding to such appeals. 

Rather than giving randomly, select causes that matter and donate strategically.

Despite good advice like that, research such as a study by donation transparency portal ChangePath in Australia shows that more than 85 per cent of charitable donations were received simply from people being asked to donate. 

While many of us do much research on the non-profits or charities we want to help, a key question is how to select the right organisation to receive our money.

Whether you have S$10 or S$10,000, most people want their donations to have as much impact as possible. 

HOW TO PICK A BENEFICIARY

To make your giving more strategic and impactful, experts suggest three steps. 

1. Figure out what matters to you

Charity assessment organisation Charity Navigator suggests that you should first identify which causes are important to you and what impact you want your donation to have.

One factor can be whether you want to donate locally or abroad, and another can be whether to donate to a small startup non-profit or a long-established charity.

You may also want to look at the scale of the impact the organisation has, the solvability of the problem it is tackling, and whether the issue is already addressed by other organisations.

Then, narrow down your options by choosing non-profits that fit with your values and align with your goals.

“The cause that you choose should be something that you’re passionate about,” donation transparency portal ChangePath Australia suggests, and also “a cause where you have a real chance to create genuine impact on people’s lives.”

2. Do some research

As non-profit assessor GuideStar describes it: “Get the cold, hard facts.”  

Check to make sure the organisation is registered with the Commissioner of Charities or Registrar of Societies, look at its finances, ensure that it is transparent, and get the details you need before making a decision.

“A reputable organisation will define its mission and programmes clearly”, GuideStar notes, and have measurable goals as well as concrete criteria to describe its achievements. Look for non-profits with a clear mission and purpose, as well as practices and procedures to make their mission a success.

It is better to make sure the organisation is financially healthy, so that it will be around long enough to achieve the results you expect.

You can also compare non-profits that do similar work, to see which one is most effective.

3. Look at your budget

Once you have found an organisation you want to donate to and have made sure it has the impact you want, decide on your budget, whether it is for a one-time donation or longer-term contributions. Then, make a donation.

That isn’t the end of the process, of course.

If you’re passionate about the cause, follow up six months or a year later to see how the organisation is using their money and decide whether to continue donating.

Doing all this analysis might sound daunting. If you need help, several organisations here have useful information about non-profits and charities.

Consulting firm Just Cause, for example, has profiles of the activities, impact, finances, governance, employees, strategy and character of charities in numerous sectors.

Giving.sg lists more than 500 non-profits and 700 causes here so that you may choose the ones you are most passionate about.

While it may seem hard to turn down requests for small donations, having gone through a process to select a charity strategically can make it easier to explain why you are not donating small amounts when you receive requests.

Then, you can continue to support the causes you care about the most and make sure you get the impact you want to achieve.

Related topics

donation money finance planning budget Charity non-profit organisations

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