How Much of Make-A-Wish Donations Go to the Cause?

Understanding how charitable donations are used is a common concern for individuals contributing to non-profit organizations. This article explores the allocation of funds within a major charity, specifically the Make-A-Wish Foundation, to help donors make informed decisions and understand where their money goes.

Make-A-Wish’s Program Spending

Make-A-Wish dedicates a significant portion of its financial resources directly to its mission of granting wishes. As of December 2024, the Make-A-Wish Foundation of America reported a charitable commitment of 74% of its total expenses. Prior to the COVID-19 pandemic, in fiscal year 2019, the organization reported using more than 75% of its funds specifically for wish granting.

Program spending for Make-A-Wish encompasses the direct costs associated with fulfilling a child’s wish. This includes expenses for travel, accommodations, special events, gifts, and any medical equipment or services directly related to the wish experience. For example, if a child wishes to visit a theme park, the costs of flights, hotel stays, and park tickets would fall under program spending. These expenditures are central to the organization’s purpose of providing life-changing experiences for children with critical illnesses.

The percentage dedicated to program spending can fluctuate slightly from year to year due to various factors, including economic conditions or unforeseen global events. For instance, travel restrictions during the pandemic impacted the ability to grant certain types of wishes, affecting the program expense ratio during that period. Despite such variations, the core mission remains the primary focus for the majority of the funds received.

Understanding Charity Financial Categories

Non-profit organizations categorize their expenses into distinct functional areas to provide transparency about their financial operations. These categories help stakeholders understand how funds are allocated beyond direct program delivery. The Internal Revenue Service (IRS) requires tax-exempt organizations to report their expenses in these specific functional categories on their annual information return, Form 990. This standardized reporting allows for a clearer overview of a charity’s financial health and operational efficiency.

“Program Services,” also known as “Program Expenses,” represent the direct costs incurred in delivering the organization’s core mission. For Make-A-Wish, this category includes all expenditures directly related to granting a child’s wish, such as travel, entertainment, gifts, and medical support. These are the expenses that directly benefit the individuals the charity serves and are fundamental to its existence. This category is typically the largest for a well-functioning charity, reflecting its primary purpose.

“Administrative Expenses,” often referred to as “Management and General” expenses, cover the costs necessary for the overall operation and oversight of the organization. These include salaries for executive staff, accounting and legal fees, office rent, utilities, and information technology infrastructure. While not directly linked to wish granting, these expenses are essential for maintaining the organization’s legal compliance, financial integrity, and daily functioning. Without proper administration, a charity cannot operate effectively or responsibly manage its resources.

“Fundraising Expenses” are the costs associated with soliciting donations and securing financial support for the charity’s mission. This category includes marketing and advertising campaigns, donor outreach efforts, costs of fundraising events, and salaries for staff dedicated to development. These expenditures are necessary for a non-profit to generate the revenue needed to sustain its programs and operations. Investing in fundraising ensures the continued ability to fulfill wishes and expand the organization’s reach.

Finding Charity Financial Information

For individuals seeking to understand how a charity utilizes its funds, several resources provide official and independent financial information. The most direct source is typically the organization’s own website, where they often publish annual reports. These reports offer a comprehensive overview of the charity’s activities, financial performance, and impact over the past year.

Another crucial document for financial transparency is IRS Form 990, which most tax-exempt organizations are required to file annually. This form provides detailed information about the organization’s activities, governance, and financial data, including revenue, expenses broken down by functional categories, assets, and liabilities. Form 990s are public documents and can be accessed through various online databases.

In addition to direct organizational reports, independent charity evaluators offer valuable insights by analyzing publicly available financial data. Organizations like Charity Navigator, GuideStar (now Candid), and the BBB Wise Giving Alliance assess charities based on various metrics, including financial health, accountability, and transparency. These evaluators often provide ratings or seals of approval, along with summaries of financial performance, helping donors compare and assess different non-profits.