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I had a candid conversation with a near-retirement athlete (name withheld for ethical reasons but let’s call her Jane) about her future after years of active professional sport. She was concerned about how to maintain her charitable activities without wasting her savings.
Influential individuals, including celebrities and athletes, are very active in charitable activities. The communities’ strong influence in supporting ‘their own individual’ or supporting their home team helps nurture these relationships. Some successful athletes also benefit from not-for-profit, community-led programs. Therefore, athletes are more likely to return the favor by engaging in community empowerment activities. But at what cost?
From my conversation with Jane, she told me that even though she registered a nonprofit in her name, her donations to other charities were made using her personal account (nothing wrong). However, as someone who would like to get more involved in charity, the problem then becomes how do you request funds using your personal account? How does she manage her personal finances separate from charitable work?
Like Jane, there are other individuals who are passionate about philanthropy but lack strategies for raising money from their networks, and so end up injecting their savings just to keep up in the spirit of giving back to the community.
Without following a solid plan, it’s easy to deviate from your goals. Without a strategy, a lack of financial wisdom creeps in and this becomes a liability to your personal and not-for-profit accounts.
Once concerns about financial management and accountability arise, the risk of harm to your brand and persona escalates. The effect is devastating to both your non-profit activities and your personal life, including the financial one. Negative publicity damages your reputation and credibility. It may also attract punitive action from government and professional law enforcement agencies.
Some of the disciplinary actions from professional regulators and the (federal) government include; Cancellation of registration, freezing of personal and organization assets, or imposition of fines to act as a warning.
Fortunately for Jane, her case was crystal clear as my contribution was technical. We have created the technical structures of its non-profit organization and developed a strategic and operational plan. The strategic operating plan will serve as a policy guideline for the nonprofit in the midterm.
I’m also glad I met Jane and worked with her to develop a prudent plan for how to solicit and manage money from the donors in her network. Most importantly, I’m glad I worked with Jane to separate her personal financial activities from those related to her organization.
There may be other people who have similar concerns as the one Jane had. Others may have unclear fundraising strategic plans. I advise you to seek professional help to correct these concerns. Not only does it stifle your organization’s growth potential, but it also exposes you to self-reputation or financial harm.
