Some Veterans Charities
Falling Short

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Do you support veterans charities? If so, this is a report you definitely will want to read.

We've previously brought you warnings about various scams to watch out for. This is not necessarily about a "scam," but rather a caution to be careful about which charities you support. Otherwise, you may feel that you've been scammed.

When you donate to charity, giving generously to organizations you believe will use those funds to aid service members, veterans and their families, it can be shocking to learn what a small amount of the money you donate to charity is actually used for the causes they support. For this reason, you want to make sure you research any charitable organization before giving.

We're bringing you this information to help you ensure that your hard-earned dollars are actually going to the veterans charity causes you want to support before you donate charity.

Some veterans charities are shortchanging the nation's veterans, actually funneling far too little of the money they collect to their "charitable purposes." Some of the causes for this include:

  • ineptitude at fund raising,
  • paying high fund raising costs to third parties, and
  • paying high salaries and benefits to the organizations' officers.

The use of tax-exempt organizations to solicit donations is an area that unfortunately has been inundated with fraud in recent years, particularly the establishment of new "charities" since the 9/11 tragedy. Many unscrupulous individuals are "cashing in" on America's generosity to help those in need in order to line their own pockets.

In order to qualify as a tax-exempt charitable organization under IRS Code Section 501(c), an organization need contribute a mere 5% of the fair market value of its assets to its designated charitable cause. Obviously, if its assets consist of cash solicited from donors, that means it would have to donate only 5% of the cash it collected in order to maintain its tax-exempt status.

Take a look at this ABC news report for a better understanding of the problem. It discusses serial charity entrepreneur Roger Chapin and his two veterans charities, Coalition to Salute America's Heroes and Help Hospitalized Vets, both of which received F ratings from the American Institute of Philanthropy. Despite receiving more than $70 million in donations, Chapin's organizations used less than 32% of those donations for their actual charitable purpose. In the meantime, Chapin and his wife are paid more than a half million dollars a year from those funds, and have a very generous "retirement plan."

The Washington Post also published an expose of veterans charities that are falling far short of expectations. There were some surprising names in the report they reference, by charity watchdog organization American Institute of Philanthropy.

There are, however, many fine charities out there, organized and operated efficiently, and using a much larger percentage of their revenues for their stated charitable purposes. We wouldn't want the recent media reports of abuse to hurt the fund raising efforts of the legitimate veterans charities who do a wonderful job of providing assistance when and where it's needed.

So it is very important for you to do your research before you select any charity to receive your hard-earned dollars. After all, you want to make sure your money supports the causes you want to support, and doesn't go to pay some third-party fund raising expenses, or buy a new vacation home for the "charity's" CEO.

We're happy to report that our two favorite veterans charities, charitable organizations supporting military families, both scored very high.

Fisher House Foundation was created by military supporters Zach & Elizabeth Fisher, and provides low- or no-cost housing to military families in "comfort homes" located on the grounds of military and VA hospitals. As a result, family members can be close by to offer support and encouragement as their loved ones undergo treatment in those facilities.

Fisher House Foundation scored an A+, using 92% of its budget for program services, and spending only $2 to raise $100. We feel a special affinity for Fisher Houses, and we encourage you to read the story about the inspiration for and creation of Fisher House. The Vietnam vet in our house was fortunate enough to know both Zach Fisher, who founded Fisher House along with his wife Elizabeth, and Pauline Trost (Mrs. Admiral Carlisle Trost), whose idea served as the inspiration for Fisher Houses.

The National Military Family Association (NMFA) was organized in 1969 as the National Military Wives Association by a group of wives and widows seeking financial security for survivors of uniformed service personnel and retirees. NMFA is the only organization that lobbies Congress on behalf of military families. It tracks legislative issues of interest to military families, and encourages Congress to remember its responsibility to our service members and veterans, and their families. NMFA rated an A, using 82% of its budget for program services, and spending only $9 to raise $100.

These two organizations had the lowest percentages of fundraising expenses of all the organizations rated in this report. At the other end of the spectrum, National Veterans Services Fund spent $97 to raise every $100, and American Veterans Relief Foundation applied only $1 of every $100 towards program services!

So make sure your dollars actually go to the causes you wish to support, and not into the pocket of a third-party fundraising consulting group.

See Charity Expose: Veterans Charities Missing the Mark.

To see how the various charities fared in the ratings, go to Veterans Charities Ratings.

For more detailed explanation of the ratings, and how they were calculated, go to Veterans Charities Ratings Explained.

Do you have questions about specific veterans charities? First, check the references listed at the bottom of Veterans Charities Ratings to look up information about the charity you're interested in. If you can't find the answer to your question in any of those sources, ask your question about veterans charities here.

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