When you donate money to a charity, what % actually gets through to the needy?

Question

I always hear that a large portion is used for administration costs, lunches, and some fat payrolls ....

Answer 1

Normally they will take 10-30% as management cost to cover the running of the organisation.  It is well accepted all over the world...

Answer 2

tele marketing can take up to 70%, u.n.i.c.e f.the same, world vision is also very high,who pays for all those photos.

caritas is about 6% , they send out an audited a/c each year

Answer 3

It varies. Just ask them.

Answer 4

Well I'm a member of the Junior Auxiliary. Everything we do is for the needy children in our area. All of our members volunteer time and own money. We do not get any money for what we do. All of our donations and fundraisers go directly to the children as it should. We pay dues to be in this organization, if we have lunches we bring our own potluck style and we aren't paid.

I would suggest donating to local charities if you wish to donate, as they are more likely to not take any money into their own pockets.

Answer 5

Great question!

The answer is "it depends" .  You can actually check on any US charity's tax return at www.guidestar.com to see what percent they spend on programs (what gets through to the needy, basically) versus administrative costs.  US charities' tax returns are posted on here.  

All you have to do is sign up and create your own password.....it is free to look at the returns.  Don't worry about the other options that they now charge for.  The tax returns are from IRS so they cannot charge you to see them.  Once you look up a charity, scroll all the way down almost to the bottom of the page and you will see their 990 (which is the tax return charities file).  The most recent year listed is the most recent one filed...most would be only 2006 by now since most 2007 returns are not filed yet.

The front page will tell you total income and total expenses and any profit or loss they made.  The second page is where you will see spending breakout by programs, administration, and fundraising costs.  There is even a page on which the charity has to list salaries of anyone paid over $50,000, so you can look at their higher paid staff salaries.

There really is no strict rule on a certain percentage that should go to programs vs administrative/fundraising. It can be deceiving....small or new organizations will have more as a percentage of total income going to programs beause they have no or few staff.  Medium sized organizations may have a higher admin cost because they have finally grown to the point where they are now able to hire one or two people with salaries, but 90% their time is spent directly on programs since they have very little administrative work, etc.

You can also look up charities at www.irs.gov.   If you have trouble finding a charity on guidestar, use the advanced search and only put in a key search word and/or a location.  

The most important thing is there are tools out there now you can use to be more certain your contributions are being used as you are told they are going to be used, in a financially responsible manner.  

As in any field, there are bad apples out there, but those are the ones that make the news and, by far, not the majority of charities doing good work.   My suggestion is to ask questions, do your research, and make an educated decision of where to put your charitable dollars.

My best.  Hope this helps,  Teresa