New York – Millions of people have been displaced by global conflicts. Communities are grappling with unseasonably intense natural disasters. Health care disparities have disrupted lives.
Nonprofits, everyday individuals, and mutual aid groups established in the midst of these crises are all looking for your money to make a difference. But with no shortage of worthy causes and the rise of new giving technologies, how should you donate?
For those willing to open their wallets, the options may be stable. Many people value traditional charity. But others — Gen Z and Millennials, as well as the unmarried and the less religious, according to 2021 research from the Indiana University Lilly Family School of Philanthropy — prefer to crowdfund by collecting online donations for people in dire circumstances.
The approaches reflect different assessments of impact and credibility. But they are not necessarily in opposition.
“It’s really: What is the right kind of support that an organization or a community or an individual needs?” said Todd Bellis, chief customer officer at Bloomerang, who co-founded a platform that helps nonprofits raise money online. “And being able to tailor it to the individual donor.”
Here are some questions worth considering as you’re determining which aid best suits your purposes:
This may depend on whether you want to make a big difference for one person or help make a difference on a larger scale.
Tiltify is a technology platform that helps nonprofits and individual crowdfunders alike raise funds. If donors want to ensure that communities recovering from disasters get food, Tiltify CEO Michael Wasserman says nonprofit contributions are probably best, since established organizations already have distribution pipelines and built-in expertise. .
But if you want to make sure a special person can take care of themselves, he said, a direct donation to a crowdfunding campaign may be more meaningful than sending money “through a charitable funnel.”
Wasserman said, “It really depends on what your goal is as a donor: if you’re trying to help someone specifically or if you’re trying to help people in the plural.” Are doing.”
According to one nonprofit that provides cash transfers, you can do both at once. GiveDirectly reports sending more than $860 million to 1.6 million people across three continents. Senior program manager Richard Nkurunziza says there were initially fears the idea would be misused. But GiveDirectly found that cash donations are a respectful way to empower poor people to invest in their unique needs.
In Rwandan villages, she said, recipients have spent donations on home renovations, new businesses and youth education – which ultimately benefits their entire community.
“There is some agency there,” Nkurunziza said. “This gives the recipient the opportunity to decide how to use the money for themselves.”
According to Claire Van Tunenbroeck, a professor at the University of Twente who specializes in online giving practices, crowdfunding can be considered “more democratic”. This is because donors have more control over the use of their gifts when they choose exactly who will benefit.
The disadvantage, he said, is that the people with the greatest needs are not always the most successful. Humans tend to favor “easily sellable” projects with strong emotional appeal. Studies have also shown racial disparities in crowdfunding.
According to the company’s Generational Giving Report, the most popular reason donors told Bloomerang they have stopped giving is because they don’t trust that contributions are being used wisely. The second most common response was that donors no longer felt connected to the nonprofit they previously supported.
The answers emphasize the need for recipients to actively prove their credibility.
Tax-exempt nonprofits must submit annual financial disclosures to the Internal Revenue Service that include publicly available information, including executives’ salaries. Watchdogs like Charity Navigator compile lists of verified nonprofits and assess their work.
Crowdfunding, while convenient, is more vulnerable to fraud. Online sites are relatively unregulated, leaving responsibility for security up to donors and platforms. In the case of GoFundMe, donations can be refunded up to one year after they are made. The company also recommends that organizers identify themselves and their beneficiaries, and specify their plans for spending contributions.
According to Van Tunenbroeck, online users mistakenly associate high donation numbers with credibility. He said the risks can be better mitigated by ensuring that the project description is detailed.
“For a donor, if you prefer more certainty, traditional nonprofits are probably better because they have an established reputation,” she said.
ALSAC CEO Rick Shadyac said his charity works hard to assure donors that their money is supporting St. Jude Children’s Research Hospital’s mission: by covering the cost of care and research treatments for children around the world. Improving cancer survival rates.
Shadyac encouraged people to give regardless of medium and to always look for reputable causes. Authentic donations, he said, bring “more confidence” while crowdfunding requires more “due diligence”. But he sees room for both.
“They should really complement each other,” he said.
“Some of it is in the realm of micro-philanthropy where they may want to help a specific person because they found themselves in difficult circumstances,” he said. “But if you want to help kids with cancer, you want to help treat heart disease, there are charities that focus on that.”
ALSAC gets about a quarter of its annual revenue during the last two months of the calendar, which is around the time of year that’s designated as “giving season,” Shadack said. He said this increase could be due to the spirit of generosity during the holidays. Sure enough, a 2023 study found that people in a good mood are more likely to make charitable donations.
They may also be making their year-end tax plans.
“Not-for-profit gives them an opportunity to address some of the things that are important to them while still getting a tax deduction,” Shadyac said.
However, crowdfunding donations to individual campaigns cannot be written off on your taxes. But crowdfunding may make it easier to identify the ultimate beneficiaries of someone’s gift, Van Tunenbroeck said.
Mutual aid refers to a mutual support network of neighbors who immediately meet each other’s most urgent needs when existing systems fail to make them whole. Because of those interpersonal relationships, participants often describe this work as “solidarity, not charity.”
In the Internet age, these groups often solicit cash contributions through online payment processors such as Venmo, Cash App, PayPal or Zelle. Anyone can scan a QR code to donate, which is usually reposted on social media accounts. The money goes directly to those affected or helps purchase supplies for shared resources like community fridges. Transparency can come in the form of screenshots of receipts shared by organizers on their profiles.
Tamara Neese joined several mutual aid efforts during the early days of the coronavirus pandemic to care for her neighbors in Oakland. Neese, director of the nonprofit research institute Data & Society, said these groups begin as an immediate response to crises that are severely harming disadvantaged communities. The idea, he added, is that “state abandonment cannot be addressed by charitable donations alone.”
Neese said the challenges of such grassroots, grassroots groups are that resources become scarce and people become exhausted. Only so many requests can be fulfilled. Clash in the politics of organizers!
They found that the benefit is that support comes from within the community and members have direct contact with those who use it.
“It’s not just a feeling of charity, like you donate and you’re done. There’s more of a relationship involved and it’s not just transactional,” he said.
Associated Press coverage of philanthropy and nonprofits is supported through a collaboration with The Conversation US, with funding from the Lilly Endowment Inc. Solely responsible for this content. For all our philanthropy coverage, visit /hub/philanthropy.
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