With the launch of sites like Kickstarter, GoFundMe, and Indiegogo, crowdfunding has taken off in recent years. While most crowdfunding efforts used to revolve around entrepreneurial ideas and new businesses, these sites are now widely used to help with personal expenses and crises.
But sometimes it can get ridiculous. Sometimes you will see requests that make you shake your head. But does that mean it’s always bad?
If you’ve ever found yourself in financial trouble, you may have wondered if crowdfunding is a viable option. Find out when crowdfunding is appropriate and how you can avoid crowdfunding scams.
One-Time Expenses vs. Ongoing Expenses
First, think about what kind of expense you are thinking about crowdfunding. While it’s generally considered okay to crowd fund a huge medical bill for an accident or disease, ongoing bills are less successful with crowdfunding efforts. Consider setting up a campaign for a one-time expense, rather than keeping up a campaign for bills that will keep recurring. The longer you ask for money via your campaign, the more likely you are to unintentionally alienate or annoy family and friends.
What’s the Nature of Your Campaign?
It’s also important to consider the nature of your campaign. Take a hard look at your situation and consider whether or not people are likely to be sympathetic to your request. For example, people are more likely to be sympathetic to medical bills incurred during an accident than they are to be crowdfunding campaign that aims to pay off your credit cards.
Remember, too, that most crowdfunding sites allow comments. If you worry about how your request will be perceived or you are sensitive to criticism, consider whether or not crowd funding is worth the possible mental stress.
Keep in mind that you can still crowdfund even if you don’t fit these qualifications—you just may not have as much success as you would otherwise. Give it a try if you’re curious!
Even if you’re not starting a crowdfunding campaign, you’ll undoubtedly come across campaigns on social media. Use these tips to avoid getting scammed.
Research the Campaign Creator
Before pulling out your debit card, do a little bit of research into the campaign creator. Check out their social media and online presence. If they are raising money for an unexpected tragedy, verify their accounts with new stories and outside sources.
If you can find information on a campaign creator or they give very little information about themselves, be wary. It may well be a scam.
Stick to Campaigns You Know and Trust
With business crowdfunding campaigns, you can assess their claims based on their professional background and experience. When it comes to personal crowdfunding efforts, it is easy to get sucked in by a sad story that may or may not be true. Stick to campaigns run by people you know personally or campaigns run by people that others in your life can vouch for. It’s wonderful to help others, but you do need to protect your hard-earned money.
Crowdfunding makes the most of each individual person’s spending power to jump start businesses and inventions. Whether you are looking to run a successful campaign or just protect yourself from scams, use these tips and common sense to keep yourself out of trouble.
What do you think about crowdfunding? Would you ever do it?
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