What Percentage of Donations Do Charities Keep?January 25, 2023
When you choose to donate to a charity, you may wonder what percentage of donations do charities keep. You want to make sure your charity will use your gift in a way you support, so it’s essential to research before donating. Every non-profit or charity is different in how they use donations, too. In this article, we will explore what percentage of contributions charities typically keep and where your money goes when you donate.
With the rise of inflation this year, it’s more important than ever to be mindful of where your dollars go. When deciding where to donate, one helpful tool is to check out a non-profit’s or charity’s profile. This profile is different from their website, which is also valuable to research. On their profile, you can find their annual report, financial statements, and information about how they operate their non-profit. You can also look at charity validators like Candid.
Vehicles for Change has a Platinum rating with Candid, which was designed for organizations to show their transparency to donors and stakeholders and can also be a helpful tool when conducting research.
It’s important to note that every non-profit or charity will have expenses to operate, pay employees, and cover administrative overhead. The percentage of these expenses vs. program costs is typically not a good measure of a charity’s performance and tells us nothing about an organization’s true impact. Instead, focus on a charity’s transparency, governance, leadership, and results. Of course, there are some examples of an overhead ratio being extremely out of balance. In those cases, it can be a red flag that you want to pay attention to, but in general, there are more important factors when deciding whether a non-profit or charity is successful.
It’s hard to have an exact answer or even an average of what percentage of donations do charities keep, as it depends on the organization at hand. For example, Doctors Without Borders states that roughly 89% of their donations go directly to programs that help different communities. The Nature Conservancy, which focuses on protecting and conserving water and land, says that 71.2% of its income goes toward scientific programs. All in all, it varies from organization to organization.
Where Money Goes When You Make a Donation
Donating to a charity or non-profit can be similar to an investment. Often, you trust the organization to spend your money how they see fit. The charity will get your money and process it with their bank. Then the money you donate could go to the organization’s different missions – building homes, offering food to those in need, selling a family an affordable car, or being put aside for a future project. It’s important to note that often an organization can take your dollar further than you can because they can often get special deals for being a charity or non-profit.
Your donation can also go to overhead which can include fundraising costs to help the charity to be as successful as it needs to be. Each organization is different, so look into your specific charity to learn more about its process.
Contact Us Today
At Vehicles for Change, we use your monetary and car donations to fix vehicles to award to low-income families. That way, they can access better-paying jobs and be more present with their families. We also use monetary and car donations to help train employees and offer re-entry skills to individuals to become advanced auto mechanics. Contact us here if you are interested in learning more about donating your car or offering a monetary donation.
We look forward to hearing from you!