With most Americans tightening their budget belts and watching each dollar that goes out the door, charities are feeling the effects of an uncertain economy. Though the economy is certainly up from where it was when the market crashed in 2008, many people are still struggling to make ends meet.
According to the Associated Press, last week the number of people applying for unemployment benefits dropped by 21,000. This is hopefully an indicator that the job market is improving; however, unemployment remains at an average of 7.3 percent, not counting discouraged citizens that aren’t even applying for work anymore. But even if that’s the case, it will take a while for those who have been unemployed for a while to get back on their feet.
The average American donates about $2,500 per year to charity, according to the Chronicle of Philanthropy. And households that earn more donate more. Many of those who give regularly to charity say they will continue to donate at about the same level, but the tough economy means that some newcomer donors may not take up the torch, after all.
The fact that nonprofits may find themselves coming up short is a good reason for donors to be smarter about their gifts this year. Kelli Grant of CNBC gives some great tips for choosing a charity that’s right for you, that is wise with its money, and will give you the most bang for your buck. Check out her video on CNBC here.