Getting the most bang for your charity buck

The Life You Can Save and GiveWell recently released their lists of the most effective charities for 2016/2017. Both organizations use different methodologies to evaluate which charities do the best work.

TLYCS was founded by Peter Singer and revolves around the idea that

if we can provide immense benefit to someone at minimal cost to ourselves, we should do so. And since there are charities that dramatically improve, or even save, the lives of people living in extreme poverty (i.e. living on less than $1.90 USD/day) for relatively little cost, we should support those highly effective charities.

There’s a decent amount of information to wade through in regards to how TLYCS selects it’s charities, but the gist of it is:

The Life You Can Save’s charity recommendations are based on robust research on effectiveness. We use three criteria, which we call “the three E’s:”

  • Evidence: Why do we believe the charity produces good outcomes? We consider the size, quality, and relevance of the evidence base for the charity.
  • Efficiency: How cost-effective are the charity’s programs? We want to find charities offering the most “bang for the buck.”
  • Execution: Do we believe the charity can translate marginal donations into good outcomes? We consider whether the charity has good programs in need of funding and the capability to execute those programs.

GiveWell evaluates charities using four criteria: effectiveness, cost-effectiveness, transparency, and room for more funding. Their mission is to

find outstanding charities and to publish the full details of our analysis to help donors decide where to give. Our focus is on finding the most outstanding charities possible rather than completing an in-depth investigation for each organization we consider. In addition, we’re interested in identifying and supporting the study or growth of potential future top charities and programs.

There is also an organization that evaluates animal charities for effectiveness, Animal Charity Evaluators, and they too have released an end of the year list.

In light of the incoming Trump regime Charlie Bresler, the Executive Director of TLYCS, released a statement with regards to the idea of giving to causes that are in peril:

The election of Donald Trump has had a chilling effect on many of our subscribers, our recommended charities, our Team at The Life You Can Save, and people throughout the United States and the World. There is an understandable desire to do something to mitigate the damage that a Trump presidency can do to the environment, the social safety net, and to civil liberties. At a time when many people wanted to advance in these areas beyond what the Obama administration has done, there is concern that we are about to take a dramatic step backwards. How does this impact effective giving?

I have heard many people say things like, “I want to give to the American Civil Liberties Union, or another domestic activist organization.” This is completely understandable, but if it means money will be diverted from the most effective organizations this movement of charitable donations could be very bad for the global poor…

I would suggest that we continue to support the recommended charities on our new list at the same level we have in the past, or even at an increased level. The value of $1 given to a recommended charity still trumps (forgive the pun) the value of a dollar given domestically — even under the current political environment. However, as citizens I urge everyone to get involved in social movements to which they resonate whether the movement targets the environment, civil rights, or protecting our social safety net. If one feels the understandable urge to give to political movements or organizations fighting the Trump agenda then please consider giving more money over the next four years so that you don’t diminish your gifts to fight global poverty.

It’s definitely something to consider.

There is truly no shortage of worthy causes one can support with their time and money, and figuring out which ones do the best work is pretty overwhelming . By selecting one or several, you’re neglecting thousands of others, some of whom do good and important work. Any organization can make claims about the good they do without providing evidence and I think it’s good that there are independent evaluators that attempt to provide independent verification.