Bequests to charities

[TwoByFour]

DW and I are updating our will and want to include a bequest to charities. I am picky about charities, I want to make sure they are spending money efficiently so I read their 990 forms pretty closely. It is shocking how much money the execs of some non-profits are paid, even charities that have good ratings from organizations that rate charities.

So, my question here is whether others have done research into charities and if so, does it bother you that the execs get so much money? Do you just bite the bullet and donate anyway? If they are doing a good job, perhaps it is worth it. But I wonder.

As an example - World Wildlife Fund has donations of ~220 million, and of that they pay the top 4 execs $2 million total.

 

[audreyh1]

We don’t generally donate to large charity organizations, but rather to small local ones.

 

[JoeWras]

We don’t generally donate to large charity organizations, but rather to small local ones.

+1

Non-profit doesn't mean people are working for free or minimum wage. I've looked at a few larger orgs and their 990 immediately turns me off.

 

[MrsHaloFIRE]

I see this a lot i.e. people remarking "I don't give to goodwill, they receive things for free and then SELL them and their CEO is paid really well" etc and so forth ad nauseum pick a charity. 1) That's the point of goodwill- it provides job training, work history, and JOBS for people. Its not a place to go get other ppls stuff for free with no overhead.
2) If the charity is a massive organization (and some are, think of the Red Cross etc) then its not surprising they have to pay good executive salaries to get good executive leadership. Same for city managers. You managing and organization with a multi multi million dollars budget and thousands of employees? Guess what? You've earned your decent (and still not comparable to private sector) salary.

Now my soapbox complaint is all the NGOs setting up remote offices in places like the continent of Africa. Bringing over staff to run around in Range Rovers to take their kids to private schools because "safety" (YA THINK?!?!?!). And they go over on a one year contract or something and then switch out. Zero continuity. WAY TOO MUCH overhead. And what are their results? Well we put in 2 wells in towns that didn't want them, cant work on them, and cant get parts for them. And we bought some cool handicrafts. Hooray.


And I use charity navigator (online) to screen charities.

 

[Red Badger]

I see this a lot i.e. people remarking "I don't give to goodwill, they receive things for free and then SELL them and their CEO is paid really well" etc and so forth ad nauseum pick a charity. 1) That's the point of goodwill- it provides job training, work history, and JOBS for people. Its not a place to go get other ppls stuff for free with no overhead.
2) If the charity is a massive organization (and some are, think of the Red Cross etc) then its not surprising they have to pay good executive salaries to get good executive leadership. Same for city managers. You managing and organization with a multi multi million dollars budget and thousands of employees? Guess what? You've earned your decent (and still not comparable to private sector) salary.

Now my soapbox complaint is all the NGOs setting up remote offices in places like the continent of Africa. Bringing over staff to run around in Range Rovers to take their kids to private schools because "safety" (YA THINK?!?!?!). And they go over on a one year contract or something and then switch out. Zero continuity. WAY TOO MUCH overhead. And what are their results? Well we put in 2 wells in towns that didn't want them, cant work on them, and cant get parts for them. And we bought some cool handicrafts. Hooray.


And I use charity navigator (online) to screen charities.

+1.
We support large charities and local ops. We use Charity Navigator to cull the candidates. We have a couple "core charities" that we support YOY. Then, we use another bucket for 1-5 year candidates.

 

[OldShooter]

Yeah. Very tough call. The only charity I have seen where the top people are taking relatively low salaries is the Salvation Army.

I try to look at what percentage is going for overhead, fund raising, travel, and other expenses versus what is spent on what the IRS calls "charitable purpose." There are also various charity review organizations that have a bunch of hoops that a charity must jump through before being approved and listed. For example: "National Standards for US Community Foundations" accreditation, "Accountability Standards of the Charities Review Council," and I believe that guidestar.org does some vetting as well.

DW is very active on nonprofit boards and she and I debate this from time to time. Her feeling is that the people working for the nonprofit are entitled to market rate salaries while I have a vague feeling that if they are really sincere about the organization's charitable purpose they should not demand such high salaries.

 

[gauss]

DAF - Donor Advised Fund postpone the decision...

My Donor Advised Fund at Fidelity Charitable with be the recipient of most of my estate. As such, my successor trustee, will be the one scrutinizing the 990s.

In all seriousness, the ability to setup the DAF now and get it into my beneficiary lists is a huge relief in that I don't have to specify individual charities at this point.

I tend to make smaller gifts currently out of the DAF today and not worry too much about the 990s.

-gauss

 

[Teacher Terry]

Salvation Army and local charities. I am not giving my money to organizations that pay big salaries.

 

[JoeWras]

We use the DAF too. This way, the will doesn't change. We can file changes to our DAF legacy any time.


As for Red Cross/Good Will... I recognize the uniqueness of these orgs and donate stuff to them (blood or goods) from time to time to help their mission. However, in our area, there are alternatives popping up that are more local based. Much like local food, local giving has merits, and I usually go there first if possible.

 

[TwoByFour]

I don't have a problem with CEO's getting market rate. The software company I worked for was a $150 million company and our CEO earned less than $500k. Some of these CEO's in non-profits are making close to $1m for a 200m non-profit. That to me is above market especially if there is high admin overhead. It looks to me like running a non-profit can be a pretty good gig.

At any rate, using Charity Navigator I found some charities that have much more down to earth salaries and expense ratios.

 

[Pellice]

I donate to mostly environmental charities, some large, some small, some recurring, some one-time. And I donate my work to some as well. I have named two in my will. Although I don't want the top people to be making private sector big money, it is more important to me that the bottom people not be making pennies, so I don't mind if some of my money goes to improving employee salaries. There is a place for all types. Some of the larger charities do have overhead because they maintain supplies and expertise that are needed both continually and in emergency situations. The Nature Conservancy, for example, has staff with very specialized skills in land acquisition and restoration that work throughout the world. Then there was Operation Migration, which disbanded this year, which operated on a shoestring with one quixotic goal: the development of a sustainable eastern migratory whooping crane flock. Here in New Jersey there are some tiny organizations that are almost entirely volunteer, and sometimes one-time. They all have their value. But there are some that are complete rip-offs, including one that I hear ALL THE TIME on major radio and sometimes television stations that has a nebulous mission and a terrible charity navigator rating. That's a turnoff for me, if the charity is buying expensive public relations time. (I realize the Red Cross does this, but they are kind of in a special position). Since virtually all my giving goes to environmental groups, I often feel that I am personally benefiting as well, when I walk through a nature preserve.