You may wish to specify one or more of the following uses for a gift:

Capital Support
These are funds the organization needs to build, expand or renovate a facility, or purchase the equipment necessary for providing services. When considering a capital gift, look for evidence that the charity is capable of raising the entire sum needed for the project.

Endowment Funds
These are monies that are held in reserve in perpetuity, producing annual investment income over the long term that can supplement a charity's annual operating budget or fund out-of-the-ordinary expenses. An endowment is an organization's savings account, insuring that a charity can provide services on an ongoing basis despite fluctuations fundraising or revenue-generating activities. In considering an endowment gift, review the nonprofit's written investment policy to ensure the funds will be placed wisely.

General Operating Support
Just like any business, charities have general administrative and overhead costs that are not directly related to a specific program or service. The money needed to cover these costs is vital, but often difficult to secure. Review a detailed accounting of the organization's operating expenses to ensure maximum cost efficiencies before making a gift to defray those costs.

Seed Or Pilot Money
As the social environment changes, so do the needs of the community. This gives rise to new programs and services designed to meet those needs. Seed money consists of donations earmarked specifically for funding new initiatives. Before contributing seed money, ask to see detailed plans for proposed programs, including a line-item program budget, an outline of activities, and the method for evaluating the program's effectiveness.

Ongoing Program Funds
This is the bread and butter funding that every charity seeks. Donations are used to meet the costs of providing an agency's core programs and services, most of which are already established. As with requests for seed money, when contributing to an organization's ongoing program fund, be sure to review the budget, activities, and completed evaluations for such programs.

In general, capital and endowment gifts are relatively large in size. Before making a five-, six-, or seven-figure gift, consider making a more modest investment in a charity's program or operating activities. Get a feel for the organization's use of money and its standards of accountability. Once you're satisfied that the charity's work represents a sound philanthropic investment, only then should you consider a major gift.