Americans demonstrate spirit of charity

According to www.cnn.com, Americans gave almost $300 billion to charity during 2006—more than the 2005 total that included donations involving Hurricanes Katrina, Rita and Wilma, as well as the tsunami in Asia.

In fact, a November 2006 comparison from the Charities Aid Foundation shows Americans give twice as much as the next most charitable country, Britain.

When adjusted for inflation, U.S. donors gave about $295.02 billion during 2006, up 1 percent from $283.05 billion during 2005, according to an annual report released by the Giving USA Foundation at Indiana University's Center on Philanthropy. About 75 percent of the total came from individuals.

The largest amount of donations, $96.82 billion or 32.8 percent, went to religious organizations; $40.98 billion or 13.9 percent went to education. About 65 percent of households with incomes less than $100,000 gave to charity.

One notable donation that helped bump up the charitable giving total during 2006 was Warren Buffet's donation of $30 billion during the next 20 years to the Bill and Melinda Gates Foundation—$1.9 billion of that total was given during 2006.

However, corporate giving fell by 10.5 percent last year to $12.72 billion, most likely because of companies' overwhelming response to natural disasters in 2005 and weaker profits in 2006.

Regarding philanthropic giving as a percentage of gross domestic product, the U.S. was first at 1.7 percent. Next was Britain with 0.73 percent, Canada with 0.72 percent, Australia with 0.69 percent and South Africa with 0.64 percent.

Be a responsible donor

There are countless opportunities to donate to a charitable cause. However, you want to be sure you think before you give. Following are some tips for donors from www.charitynavigator.org:

• Make a choice. Don't just respond to the first charity that comes your way. Figure out what causes are most important to you, and choose charities that specifically address those causes.
• Watch for imposters. Beware of similar charity names. Although the names of two charities may sound the same, their performances could be dramatically different.
• Demonstrate telephone smarts. If you receive telephone calls asking for donations, do not give out your personal information. If you are interested in donating to the cause, get off the telephone, do some research, and send money directly to the charity.
• Avoid scams. An easy way to avoid scams is to be sure the charity you choose has tax-exempt status under section 501(c)(3) of the Internal Revenue Code. Try to resist handing money over to solicitors.
• Choose a healthy charity. A healthy charity is financially stable, allowing it to sustain its programs and services. Find charities that can grow their revenue at least at the rate of inflation; continue to invest in their programs; and have some money saved. Check out www.charitynavigator.org for analyses of charities.
• Protect your privacy. Be sure your charity has a donor privacy policy so the charity promises to never sell or trade your contact information.
• Make a long-term commitment. A charity can only be successful with committed supporters. See yourself as a partner in the charity's efforts to effect change.

This Web exclusive information is a supplement to A benevolent industry.