If you're like most Americans, you most likely give to charity during the holiday season. Last year, 95 percent of American families made charitable donations. In fact, the United States is the global leader when it comes to individual charitable giving. According to the World Giving Index, an annual report that publishes data on charitable giving across 130 countries, the United States is the only country to make the top-ten list across all charitable benchmarks.
Last year, American individual donors gave a total of $258 billion to charitable causes--more than the combined amounts donated by foundations, bequests, and corporations combined.
Exactly how much is $258 billion? That's enough to cover the combined annual costs of providing clean drinking water and sanitation for the entire global population--11 times over!
Where American donors go wrong
All this is good news, right? So what's wrong with American charitable giving?
Here's the reality: In 2013, less than 5 percent of American donation dollars went to international causes, and an even smaller fraction was allocated for effective anti-poverty relief. Unfortunately, this means that the majority of American charitable dollars never reaches the people in the developing world, those who need our help the most.
Studies show that Americans spend more time watching TV each day than the total time they spend researching effective charities in a year. That's means that most people give away their money without first considering how their chosen charity will use their donation, and whether their charitable programs will actually meet their promised benchmarks. That has to change. In order to maximize our charitable impact, we need to couple our generosity with rigorous evaluation.
The good news is that it's easy to find charities that help the global poor through cost-effective programs. Charity reviewers like The Life You Can Save, GiveWell, and Giving What We Can publish lists of highly effective charities with strong track records of helping the global poor.
Why individual donors matter
What can you do to help a needy family or child this holiday season? And can individual American donors really make a difference? Absolutely! When I was a graduate student on a small student stipend, I wasn't able to give a lot, but I liked to remind myself that even small amounts have great buying power when given to the best charities. Consider these facts: the typical American household donates an average of $2,974 to charity each year. That amount goes far--especially in the developing world, where medical services, supplies, and transportation costs are much cheaper than they are at home.
So what could the average American family expect their charity dollars to purchase?
When given to effective causes, here's what the average donation of $2,974 could buy this holiday season:
- Life-saving deworming pills for 3,717 children
- Clean drinking water for 3,304 people
- 991 mosquito bed nets that will protect 1,982 people against malaria infection for up to four years
- One year of school meals for 84 children, or
- 29 toilets for families and villages
This holiday season, what will your impact be? To find out, use this Impact Calculator to determine how far your donation could go to help the world's neediest people.