Effective Giving: Finding the Best Places to Donate Your Money

When you think about making a difference through your career, your first thought might be to work directly for a cause you care about, maybe tackling climate change or reducing poverty. This is a great way to make a significant impact, but it’s not the only way to create meaningful change. 

Another promising, and often overlooked, route is to donate a portion of your income to highly effective charities. This approach, known as effective giving, allows you to make a significant impact regardless of the field you work in.

By setting aside part of your salary for carefully chosen charities, you can support efforts to fight disease, alleviate poverty, protect the planet, or tackle a number of other important issues. And you don’t have to work for a nonprofit or pursue a specific path to do this—you can work in finance, tech, marketing, or pretty much any industry, and still make a huge difference. The key, though, is to be strategic about where you donate.

This is where the word “effective” becomes really important. We’ve all heard stories about charities that mismanage funds or aren’t as impactful as they claim. But fortunately, many charities aren’t like this. In fact, the very best do an enormous amount of good with the money they’re given.

There’s strong evidence supporting the fact that some charities can achieve many times more positive impact per dollar spent than an average charity. These charities have a proven track record of using donations in a remarkably cost-effective way, meaning the money you give to them is likely to make a big difference for those being helped.

Because of the incredible amount of good you can do by supporting effective charities, we think effective giving is a great pathway to impact, whatever career you choose. 

What makes for an effective charity?

It might seem surprising to hear that the differences between charities can be so large. But when you dig into it, it makes sense—in general, the most effective charities employ practices that set them apart from the rest.

For one, they focus on a high-priority cause area. Prioritizing which problem to work on has an enormous influence on how much impact a charity can have. Some problems have much more room for cost-effective work, meaning charities that focus on them can have a dramatically higher impact than others. Often, these are problems that are both large in scale and overlooked, therefore leaving more room to make a difference. 

For instance, the Lead Exposure Elimination Project works to help governments implement regulations on lead content in substances like paint in developing countries. This reduces the prevalence of lead poisoning, which is responsible for over a million deaths every year and often leads to intellectual disability, reduced educational attainment, and cardiovascular problems.

Another key factor is that effective charities focus on deploying the most cost-effective solutions they can. This means using thorough reasoning and research to identify the best ways they can help others and solve whatever problem they’re working on. This often entails rigorous measurement and evaluation of their programs to verify the impact they’re having, and sometimes even partnering with academics to run large-scale scientific studies.

A great example of this is the Shrimp Welfare Project, which works to improve the welfare of farmed shrimp. Though it may seem odd to care about shrimp, governments are starting to recognise them as sentient and capable of experiencing suffering. And, unfortunately, they’re subjected to a number of inhumane farming and slaughter practices. Through providing information and high-welfare stunning equipment, the organization estimates it helps as many as 1,600 shrimp per dollar spent on its programs. 

Finally, the best organizations have a willingness to be responsive to evidence about their impact. Charities often resist changing their programs if it turns out they’re not working as intended. It’s demoralizing, and there are often financial incentives not to be transparent about mistakes. However, the very best charities are willing to pivot in light of new information to make sure their work helps others, even when this is difficult or costly. 

For example, Evidence Action funded projects providing chlorine dispensers to help sanitize water in a number of countries in Africa. Impressively rigorous research later found that this work saved a child’s life for every $3,000 spent, leading Evidence Action to scale their programs.

So, when charities take the right approach, the amount they’re able to achieve is truly impressive, making a huge difference in the lives of those they’re helping.

But how do you find the best donation opportunities?

We gave a few examples above of charities that have been able to achieve an enormous amount of positive impact with the money they’re given. This is just the tip of the iceberg. There are lots of charities out there who can do great work with the money you give.

But with so many excellent charities deserving of money, how do we decide where to give? 

Fortunately, you don’t have to spend time doing your own technical evaluations of charities if you don’t want to. In fact, there are organizations that specialize in researching and evaluating charities, publishing their findings transparently so that you can make well-informed choices about where to give.

Below, we provide lists of both charity evaluators and managed funds that can help inform your decisions about where to give. Whatever the cause you think is most important, it’s likely that one of these organizations has identified promising opportunities to cost-effectively use your money.

Charity evaluators

Managed funds

Giving communities

Finally, many find it helpful to join a community that’s committed to effective giving. Being a part of a giving community offers social support and also helps you stay motivated to keep giving your money to impactful causes.

We want to highlight Giving What We Can, who not only help identify the best places to give, but also offer an opportunity to take their 10% Pledge. Thousands have publicly taken this pledge to give at least 10% of their income each year over the course of their lives. 

Consider that the average salary in the US is around $60,000. Donating 10% of this income to effective charities such as the Malaria Consortium would save dozens of lives over a normal career. 

Of course, 10% is a big sacrifice for many, and there are lots of constraints that might mean you donate less than this. But however much you’re able to give, giving effectively means your money can do much more good than you might have thought possible.