Practicing Strategic Compassion

A year after Katrina, the Gulf Coast is still rebuilding. Here's how to make sure your charitable giving is effective.

way you see fit. “I should read the fine print a little better next time,” Robinson acknowledges. “At this point, I can only hope that the Red Cross is allocating the money to Katrina students in need.” A year later, Robinson is going so far as researching charitable organizations that can handle donations in times of crisis so she won’t find herself in the same predicament the next time there’s a disaster. “We know every year hurricanes hit the Southern region of our country. Have a list of reputable places to send your check, which will put you more at ease than if you were waiting for Jane Doe to pop up with an organization,” she says.

Ask the right questions. The best way to make sure your money is going to a cause you believe in is to ask, says Elam. “We wanted to know if they had an infrastructure in place. Did they have relationships already established with other community-based organizations? Would they really be able to have the clout and pull to draw all the right parties to the table to get the dollars that we would contribute transitioned into services that would help the impacted people?”

Review the mission. Check an organization’s Website to make sure you understand and agree with its mission and initiatives. Many charities keep a copy of their annual report online, which provides a breakdown of how they spent their money in the past. Research how much money goes to the cause and how much goes to overhead such as administrative staff and marketing. According to chari

ty watchdog group Charity Navigator, if an organization spends less than 75
% of its funds on the cause it’s raising money for, walk away.

Check up on an organization’s finances. Ask for a copy of its most recently filed IRS Form 990, which is a reporting return that most tax-exempt organizations must file. To get a copy, along with compensation information for top executives, log on to www.guidestar.org, a site that monitors nonprofit activity. Other Websites such as www.charitynavigator.org, www.char itywatch.org, and www.give.org also provide information on how various charitable organizations spend their money.

Foundations — philanthropic entities that provide grants to groups or individuals working toward a particular cause — offer another avenue for giving. Foundations are ideal for people who want to contribute to a specific concern such as education or race relations but who don’t want to do the legwork to check out charities.

In the days after Katrina hit, the Twenty-First Century Foundation instituted the Hurricane Katrina Recovery Fund to provide money to organizations on the ground helping victims rebuild. “Our mission is to promote strategic giving in the black community,” says Erica Hunt, president of 21CF. “We research organizations in the community that solve our problems.” Ten days after the fund was created, it had raised $215,000 and had awarded grants to organizations such as the National Coalition on Black Civic Participation and the S.O.S. Coalition.

But in order for the African American community to have true financial

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