This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
See Cramer's multi-million dollar portfolio for FREE and get his new book Get Rich Carefully! Learn More

Stock Market Gains May Spur Greater Charitable Giving

By Hal M. Bundrick

NEW YORK (MainStreet) The stock market has been kind to investors in 2013, with gains so far of more than 20% on the S&P 500 in excess of 30% on the NASDAQ. As the end of the year approaches, many holders of profitable portfolios will be looking to pass on some of those gains to a charitable cause. Of course, benevolence is the primary reason but the tax benefits are a consideration, as well.

Cash contributions are the most common, but donating appreciated securities held for longer than a year allows a full deduction of the market value of an investment, and investors can avoid paying taxes on the gain.

The challenge may be finding a charity worthy of a donation.

Ken Stern is the author of With Charity for All (Doubleday, 2013) and says the biggest barrier to effective giving is the absence of readily available information about charitable effectiveness.

"The best known charity evaluator such as Charity Navigator and the Wise Giving Alliance typically do not provide information relevant to finding out which charitable programs really work," Stern tells MainStreet. "I tend to rely on the most in-depth charity evaluators such as Give Well and on the reports made available on their web sites by the charities themselves. The best charities provide on their web sites detailed accounting of their goals and independent evaluations of their success."

Give Well is a nonprofit charity evaluator that conducts in-depth research to "determine how much good a given program accomplishes (in terms of lives saved, lives improved, etc.) per dollar spent," according to its website.

"There are more than 1.1 million charities in this country and, perhaps not surprisingly in such a large group, there is a subset of really bad charities," Stern adds. "But it is very hard to tell the difference among charities. For instance, there are more than 59,000 charities with the word "veteran" in their title and it requires real expertise to tell the best from the worst. This creates an opportunity for those who are eager to deceive unwary donors. The biggest charitable fraud case -- the U.S. Navy Veterans case -- was in the veterans field. There are plenty of pitfalls for the unwary donor."

John Donald Cody, the founder of the United States Navy Veterans Association of Tampa, Fla., was recently convicted of defrauding donors in 41 states of $100 million.

"Do your homework," Stern advises. "The average household in the U.S. gives about $2,800 a year, a sizable amount. But only a small minority of donors report doing any research each year. There are many great charities, who have established incredible and proven track records of effectiveness charities like Youth Villages, the Nurse Family Partnership and Give Directly. But most donors don't find those charities because they give out of habit, to familiar brands and to the charities of friends. The great charities are out there if you look, and they deserve more attention and more support."

--Written by Hal M. Bundrick for MainStreet

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
DOW 16,501.65 -12.72 -0.08%
S&P 500 1,875.39 -4.16 -0.22%
NASDAQ 4,126.9670 -34.4910 -0.83%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto
Advertising Partners

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs