The cost of living crisis has left some charities with dwindling donations at the same time as increased demand from those in need. As households struggle with rising costs, one in five people are considering cutting back on charitable donations to help them manage bills, according to research from the Charities Aid Foundation.
A Which? survey found that four in 10 (44%) of people who have given money to a charity in the previous 12 months don’t normally do any research before making a donation. For its latest Money-saving Monday, Which? has identified ways to make your contributions count this Christmas if you’re looking to support worthy causes.
1. Check how much money from your purchase is donated
Many shoppers buy Christmas cards that donate a percentage of the profits raised to a given charity. However, Which? found that charity Christmas cards are a potentially inefficient way of donating if the percentage being given to charity is low. Always check the pack to see how much will be given to charity and consider whether it might be better to buy a cheaper pack of cards and donate the difference yourself.
The same goes for charity credit cards, which donate a percentage of your spending. According to gocompare.com, this is typically 0.25 per cent of your purchase – so spending £100 in a month would raise 25p. There are other ways to give that could benefit both you and the charity more. For example, with a cashback card that pays between 1 per cent and 5 per cent, you could donate some or all of the cashback you make.
2. Consider where your donation would be most impactful
It is worth considering whether donating to causes you care about is making a difference and the best way to support them. If the cause is already well funded, your money might have a greater impact elsewhere. If you want to donate to a charity but aren’t sure which is the best to donate to, you could check if there are organisations that might be in greater need of donations.
If you want to check how charities use your funds, most will include information on how they use their funds on their websites, but you can also contact them to find out more about how their funds are used.
3. Systemic change vs direct help
Spend some time thinking about whether you want your contribution to go towards systemic change or direct intervention. For example, donating to a cancer research charity may help develop cures and treatments to prevent more people being affected by cancer in the long term, while funding palliative care and support offers more immediate help.
4. Consider what to give
Humanitarian aid is often provided through donations of physical goods such as food, clothing and shelter, but donating money to charities can offer them more flexibility to buy what they need and enables supplies to be bought locally, or it can help fund longer-term projects.
Which? spoke to some food bank charities and found that monetary donations can be more valuable than food donations, because they allow food banks to buy exactly what they need as well as funding other support, such as fuel vouchers.
5. Give time, not just money
Many charities rely on work from volunteers to keep running. If you would like to offer your time to a charity and you’re thinking of signing up, think about how many hours you can commit to working, and what skills you can offer to maximise the value for both the cause and yourself.
6. Update for inflation
Long-standing, regular financial donations are a very effective way to give to charity. But if you’ve been signed up to give regular donations for a few years, it could be worth taking inflation into account and increasing your donation accordingly – if household budgets allow.
7. Give tax effectively
You can maximise the value of your donation to a charity by using Gift Aid or Payroll Giving.
Gift Aid means that an extra 25 per cent goes to the charity when you make a donation. Your donations should qualify as long as they’re not more than four times what you have paid in tax in that tax year. Payroll Giving deducts your donation from your wages before tax. It must be paid through PAYE from someone’s wages or pension.
8. Do sense checks
If a charity makes an unsolicited approach, use simple checks to ensure it’s legitimate. Street collectors should have ID, collection tins should be sealed and letterbox collection
bags should have a charity number. You should also look out for the Fundraising Badge logo on a charity’s fundraising materials – a purple circle containing the letters ‘FR’. Charities exhibiting this logo have committed to fundraise in line with the Code of Fundraising Practice.
9. Check the charity is genuine
Fraudsters can take advantage with fake websites, emails and bogus causes – particularly around the holiday season. If you have any doubts about a charity’s validity, you can look up the charity’s name and number on the Charity Commission register. This will also alert you if a charity is being investigated.
Most charities with an annual income of £5,000 or more must be registered at gov.uk/charity. By using the ‘advanced search’ button, you can find charities working in specific regions or countries to make sure they exist before giving out your financial information.
10. Don’t feel under pressure
Giving to charity is an important decision and sometimes a significant financial commitment, so never feel under any pressure. Always take your time, ask questions and do your research.
Reena Sewraz, Which? Money Expert, said:
“The festive season is a great time to give something back and many of us plan to donate to a charity at this time of year. However, with the cost of living crisis hitting many household budgets – some people might be worried that their money won’t go far enough.
“There are many simple steps to make sure your contributions go further. It’s important to know where your money is going so do your research about the charity and think about the best way you can support your chosen cause. Giving your time can be as precious as giving money, so also consider volunteering in a charity shop or at a charitable event nearby.”
Notes to editors:
- Over the coming months, Which? will be highlighting free and useful money-saving advice every Monday to help consumers manage the ongoing cost of living crisis. The series will cover a range of topics, from how to save money on household bills, to childcare and travel.
- Which? surveyed 1,119 adults in the UK who gave money to a charity between September 2021 and September 2022. Fieldwork was carried out online in September 2022 by Opinium and data has been weighted to be representative of the GB/UK population (aged 18+).
Which? is the UK’s consumer champion, here to make life simpler, fairer and safer for everyone. Our research gets to the heart of consumer issues, our advice is impartial, and our rigorous product tests lead to expert recommendations. We’re the independent consumer voice that influences politicians and lawmakers, investigates, holds businesses to account and makes change happen. As an organisation we’re not for profit and all for making consumers more powerful.
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