10 Tips for Giving

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Giving to nonprofits sounds like it should be an easy thing to do, but it takes some thinking to achieve the kind of impact you hope to make. We asked Phil Ellis, executive director of the Grand Traverse Regional Community Foundation, for 10 tips when considering donations, regardless of level of giving.

Know yourself! Match your passion with your purpose and give to those organizations doing work that supports your values. One exercise Ellis likes: Write down your three most significant values … family, faith, environment … whatever they may be. Then pull out your checkbook records and credit card records and see if your expenses line up with your stated values. How would you like to see that change?

Be strategic. At the beginning of the year, sit down and ask yourselves, what do we want to achieve with giving this year? What impact do we want to have? If there are multiple family members involved or two spouses, know that you don’t all have to be on the same page. There is plenty of room for diversity in giving.

Bring young children into decisions about giving. If they get an allowance, maybe a little is spent on having fun, a little is saved for a college fund, and a little goes into a separate bucket for giving. Even if it’s just $10 a year, you are achieving the much more important goal of inspiring the ethic of lifelong giving.

Don’t underestimate the value of your giving. You may not be able to give a large lump sum donation, but smaller annual donations really add up over time. For example, if you were to give $250 a year to an organization important to you, over 10 years, that would add up to $2,500, making you a significant donor. And reliable, annual donations are extremely important to nonprofits for planning and stability.

Learn about the organization you are giving to. Today’s internet makes doing background research on nonprofits easier than ever before. Online services like GuideStar make available government reporting forms that nonprofits file and collect information about religious organizations that are not required to fill out some government forms. Much of the information is free, but more in-depth information is available by paying a subscription fee. Some basic questions to ask: Does the organization do an annual outside audit? Where does its money come from? How did they spend it? What percent goes to administrator salaries?

Give thought to whether you want to give to one organization and have the maximum impact on your single most important issue, or if you want to support, say, 10 organizations. If you do give to several organizations, Ellis counsels to do a little research to make sure you are not duplicating effort. Giving to one or several are both effective, but being intentional about that decision gives you peace of mind.

There will likely be transition points in your giving patterns. Like, say, if you move Up North to retire, and you’ve always given to the symphony where you previously lived. Do you keep giving to that symphony, since you believe in their work? Or do you give to a Northern Michigan musical nonprofit? Again, neither decision is right or wrong, but it again gets back to intentionality, matching your passion with your purpose.

Know the difference between charity and philanthropy as it relates to your giving goals. Charity is more about helping in the moment, like giving to a relief fund for food and shelter following an earthquake or a hurricane. Philanthropy looks further ahead into the future, focusing on strategic solutions to long-term problems. We need both, and each donor should understand how they want their dollars to help.

Think about making philanthropy part of your legacy by including giving in your will. If things like the uncertainty of financial markets or unknown future expenditures makes you uncomfortable about stipulating a specific amount to give, Ellis suggests setting a percentage of your estate to give instead, so your donation will automatically scale up or down based on the value of your estate.

Consider hiring a philanthropy advisor. There are people who make a living helping people decide where they can make the greatest impact with giving. There are also people who professionally manage family foundations. Some consultants research giving opportunities and follow up on the outcomes: are the terms of the giving being met, to goals followed through on?

Know that by taking part in charity and philanthropy you are joining a great American tradition, one that began with the earliest days of our nation. It’s a tradition that many cultures do not share, and we are so fortunate for it to be a part of our national fabric.

Phil Ellis joined the Community Foundation staff in January 2009. He holds a Ph.D. in clinical psychology and moved to Traverse City following a 28-year career as a clinician and administrator with a large, private mental health organization. He also ran the organization’s $20 million foundation. The Grand Traverse Regional Community Foundation facilitates philanthropy and permanent endowments, enhancing the quality of life in its five-county region.

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