What Is Goodwill Car Donation Money Used For?

by: Amy Elder

Curious about what Goodwill car donation money is used for?  When a person donates a vehicle to charity, the charity will usually turn around and sell the vehicle at auction.  Once sold, the charity takes the proceeds from the sale.  But what happens then?  Where does the money go?  How and who does it help?  These are all important questions to ask before deciding upon a charity to receive your vehicle donation.

Once the charity has received a vehicle, the process of turning that vehicle into cash is a relatively simple and straightforward one.  Upon arrival, the vehicle is given a good look-over by the mechanic and then is cleaned thoroughly.  A date is then set for the car to be auctioned off.  Most charities that participate in these vehicle auctions hold their auctions either every week or every two weeks.  Therefore, if you were to donate a vehicle at the beginning of the week, it is very likely that it could be sold at auction that following weekend.   Finally, when the vehicle is sold at auction, the proceeds are given to the selected charity.

The objective for this money, and all fundraising efforts of non-profits, is to continue the mission of the charity.  In Goodwill's case, it would be to enhance the quality of life of individuals, families and communities by eliminating barriers to opportunity through different services like employment and training programs.

I know what you're thinking.  "All that sounds nice, but where do the dollars from the sale of my car actually go?"  Well, to all sorts of destinations in reality.  The fundraising money can go to pay for the logistics of the charity's different programs, such as transporting volunteers to a site or purchasing materials for the beneficiaries of an employment training program.  Sometimes the money is used to pay for staffing and administration costs, such as the office's rent and utilities or computers for employees.  And still other times the money is used to pay third-party companies that the charity outsources to do different jobs, such as web design, marketing, fundraising or event planning.

If you're interested in looking at real figures on how charities are spending the money that comes in through fundraising efforts, there are a number of charity watchdog agencies out there committed to providing that information to the public.  In addition, the Better Business Bureau has great resources on charity accountability standards.  For example, one of the BBB's standards states charities should try to shoot for 35% or less of all money coming in that is to be used for administrative costs.  Therefore, if you're doing research on a charity and you see that the percentage of the money going to administrative costs is 75, you know to donate your vehicle elsewhere.

So now you know how Goodwill car donation money can be distributed.