How to Use Charity Ratings

Many good-hearted individuals enjoy giving their hard-earned cash to their favorite charities. Unfortunately, as there are no shortage of charities to give to, there are no shortage of crooks who would like to steal it. Philanthropists who are not careful may find their donations have gone overseas to a foreign bank account or disappeared completely. In order to protect generous donors from theft, a charity rating system is in place to help protect you from crooks and scam artists. Before giving to a new charity or non-profit organization, learn how to use charity ratings.

Understanding Charity Ratings

Independent groups evaluate charities by examining several areas. All of these independent groups rate the financial stability and health and the charity's ability to focus donation on the actual charity, not just the administration. Charity ratings may also consider the charity's healthy growth and future services. Charity data is collected from federal documents like IRS tax forms.

Star System

Charity graders give charity ratings by awarding stars. Each number of stars has a special qualitative rating.

4 Stars - Exceptional charity that goes beyond standards and is a top performer in its cause or non-profit group.

3 Stars - Average or a good rating is indicative of a group that meets the standards and performs as good as or slightly better than similar charities.

2 Stars - Under average performers may meet standards but can also include near misses.

1 Star - Poor performing charity that does not meet the standard requirements in performance or reporting.

0 Star - Very poor charities are not only poor performers but may be scam artists.

Using Charity Ratings

Use these steps to get the charity rating on many charities.

Go to a reliable ratings website like Charity Navigator or Charity Watch. Please note that just because your chosen charity is listed in any particular website this does not make it a scam.

Type in the name of your charity in the keyword section. Hit the "Enter" key on your computer.

Review the results and select the charity. The star indicator will be located close to the name.