When you donate to a charity, you want to make sure your money is being well spent. A common question is “where does the money actually go?” As each charity is set up differently, this will vary. Do you research to find charities that are transparent about exactly where their donation money goes? Usually this will be disclosed in their annual report.
Assistance for a particular cause
Charity donations can go to a variety of causes and programs, depending on the mission and focus of the charity. In general, it is used to provide support and assistance to those in need, whether it’s for humanitarian aid, medical research, animal welfare or education.
For example, humanitarian organisations often use donation money to provide emergency aid and relief to those affected by natural disasters, conflicts, or other crises. This can include food, shelter, clean water, medical supplies, and other essential resources.
Charities are required to be transparent about where these funds are going and usually this information is available in their financial reports to their donors. You can also check their website to see what causes they are funding. Most organisations will have strict guidelines and ethical standards in place to ensure that donation money is used effectively and responsibly.
Administration costs
Some money will be spent on administration and operation costs, such as technology, human resources, receipting donations, IT costs, and reporting. Charities should have this information available so you can see how much money is spent on these costs.
It is important to view administration costs as an essential part of carrying out that organisation’s purpose. Proper administration ensures that the funds are used effectively, are subject to stringent compliance standards, and have the intended outcomes for beneficiaries. Without administration costs, there is no way to know how the money was spent and what impact it had.
Emergency Action Alliance (EAA) will not deduct more than 10 per cent of money raised to cover indirect essential costs. With a very low-cost base funded by our members this is an efficient model for raising and distributing funds in emergencies.
How to ensure your donation has maximum impact
You can ensure that your donation has maximum impact by choosing an organisation that is transparent and has policies in place to keep themselves accountable.
Some things to consider include:
- How are they spending their donations?
- Are donations being used effectively?
- Are they clear about the problem and what they are doing to help?
- Do they publish reports on the impact of their work?
Keeping these things in mind can help you choose a charity that is trustworthy and will use your money effectively.
How to Find a Reputable Charity
It’s important to research and choose reputable organisations that have a track record of effective and responsible use of donation money. Here are some tips for finding a reputable charity:
1. Do your research
Before donating to a charity, take the time to research the organisation and its mission. Look for information on the charity’s website, such as its financial reports and annual reports.
2. Check the charity’s credentials
Many of us may feel wary of phone calls and unknown texts as potential scams. You can ensure that the charity you are donating to is legitimate by checking their credentials on the website of the Australian Charities and Not-for-profits Commission (ACNC) who is national regulator of charities or the Australian Council For International Development (ACFID) who provide an industry code of good practice.
3. Consider the charity’s impact
Look for charities that have a measurable impact and can demonstrate how donation money is used to achieve their mission. Reputable charities will provide evidence of their impact through data, stories, and testimonials.
Examples of where your donation to Emergency Action Alliance (EAA) goes
The Emergency Action Alliance was built out of the vision to have greater impact and help more people by working together, when major emergencies take place around the world.need to use donations most effectively during an emergency. We combine 15 leading Australian aid organisations under one alliance. With the support of generous donors, we can mobilise quickly and provide crucial assistance during emergencies, disasters, and conflicts. By making it easier for Australians to donate, combining resources, more funds can be raised, and rapidly allocated to where they are most needed at the time. This allows our member organisations to rapidly scale up their operations on the ground and save more lives.
Where the donation money goes will vary depending on the emergency and need at the time. However, this can include areas such as:
- Child protection
- Support for women
- Medical and psycho-social support
- Housing, shelter and household items
- Emergency food and water
- Education and training
- Transportation of aid
- Cash assistance
- Water and sanitisation
Charity donations can go to a variety of programs and causes, depending on the focus and mission of the organisation. It’s important to research and choose a reputable charity that has a track record of effective and responsible use of donation money. If you’re interested in donating to the EAA, you can find out more about how we use your donations and how we stay accountable.
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