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4 mistakes to avoid when donating to a charity

4 mistakes to avoid when donating to a charity

Very few things are nobler than donating money or other resources to charity. Donations are often made with the purest intentions, so donors usually do not intend to sneakily gain any advantage from giving money away. Unfortunately, there are plenty of mistakes one could make while donating to charity. Some such mistakes are easy to spot and sidestep, while others are harder to avoid. One needs to avoid these mistakes when donating to a charity:

Not researching
One must thoroughly research any charitable organization or NGO before donating money to them. This involves understanding the causes and issues that the organization supports, as well as their reputation. Potential donors can check critical documents such as impact reports and annual reports to see the financial and charity history of organizations they are looking to put money into.

Failing to research may prove to be costly in multiple ways. For instance, one may donate to organizations that do not align with their causes and beliefs. Alternatively, donors may give less money than needed if they do not read the minimum requirement guidelines that such organizations enlist.

Donating only once a year
A donation should never be an obligation for anyone. People who follow a “one-and-done” philosophy to charity may as well avoid it if they cannot support multiple causes and charitable organizations throughout the year. Donating to charity has several benefits, such as building communities and creating opportunities for genuine change that can only be achieved through the support of multiple donors. Donating only once a year may diminish these benefits.

Falling for scams during crises
During floods, hurricanes, or forest fires, many opportunistic scamsters go around masquerading as NGO representatives and collect “donations” from unsuspecting victims. One must check the ID and other credibility-establishing documents of such representatives before shelling out any amount of money.

Neglecting to record donations for tax purposes
As implied earlier, donating comes with a host of benefits for donors. One such benefit is tax rebates and exemptions on income earned throughout the year. However, to avail of these benefits, one must record the donations made and keep the receipts and other transaction proofs with them. When they file for tax returns, they must provide these documents as evidence of donations made throughout the year.

Not recording donations or keeping receipts can nullify any tax benefits one stands to get when one contributes to charity. In addition to the above, another common mistake is succumbing to emotional pitches.