Today we’re back with our I’m Ready To Adopt series with the ninth in a 10 post mini-series by Kelly – who blogs at Mine In China – on How To Choose An Agency. You can find links to the previous posts here.
Grants, Fundraising, and Understanding the Business Side of Agencies
Finances are an important consideration for many parents. Few have all of the costs needed when starting the process and fundraising is increasingly becoming an accepted part of the process. First, if you do not have all of the funds starting off, be sure to ask potential agencies for a payment schedule. Some agencies require that you have at least half of the funds upfront. Most agencies will have points where you cannot progress further if you are not paid up, often at either dossier submission (DTC) or travel.
Be sure to budget carefully knowing what you need to pay when. My agency had us pay the orphanage donation at LOA, although you could make payments on it until travel. Most other agencies don’t have you pay that until you travel, but it can often be difficult for people to come up with the orphanage donation funds plus travel costs all at the same time. If you add in an agency that requires you to pay several thousand for post placement visits at the same time, that is a big chunk of money to come up with at one time and it comes up must faster than you think it will when you first begin the process.
If you are beginning an adoption without the full amount of funds available you should give serious consideration to how you expect to make up those funds. Ideally you would have a large portion of it when you start and a plan for how you are going to bring in the rest. Tax refund, selling stocks, home equity loan, fundraisers, whatever. Make sure you consider carefully how and when you think the money will be coming in, and remember that you can choose to delay several months or a year before starting the process if you need to be more financially secure.
If you are feeling daunted at the thought of the cost of international adoption, No Hands But Ours has two excellent articles on raising funds which you will find helpful. 22 ways to raise funds for adoption and 4 more ways to raise funds for your adoption.
In the previous article we discussed how difficult it can be to compare costs between agencies. When you are comparing the “sticker price” of agencies, don’t forget to ask about grants that an agency might offer which could lower their cost. This can sometimes make a substantial difference in the costs between two agencies.
Other related questions to ask potential agencies:
- Do you offer grants for waiting children?
- Do you offer a returning client discount? Military discount?
- Is there is an agency fee reduction for adopting two children at the same time? (if applicable)
- Are the grants automatic or is there an application process?
- Do you partner with any organizations such as Brittany’s Hope?
- If I have funds available through an organization such as Reece’s Rainbow or Adopt Together, will you count those towards our bill? Do you charge a processing fee for the transfer of these funds?
- Do you have a way for people to contribute directly toward our adoption costs? Is there a fee associated with this?
- If people contribute funds that are more than the amount owed to you, will you keep the extra funds or are those returned to us?
- If I receive notice of a grant after my child is home which is paid directly to the agency, will that amount be refunded to us (since you’re already paid off the bill) or does the agency keep the grant money?
When you are comparing agencies it can be helpful to understand why it is that costs vary so much between agencies. While people sometimes assume that “bad” agencies charge high fees and “good” agencies charge low fees because they only care about finding children homes, this view is missing the basics of how businesses are run. Larger agencies often have higher fees because they have higher operating costs. Supporting a dozen orphanages in China rather than only one is just one of many differences that can add to an agency’s operating cost. A larger agency will often spend more than a smaller agency’s entire operating cost on humanitarian aid programs alone!
A larger agency will:
- Have multiple offices in the United States (multiple buildings, staff, etc.)
- Operate programs in five or more countries (adds travel to multiple countries)
- Have in country offices in multiple countries (buildings, staff, taxes to multiple countries)
- Operate aid programs in the countries where they have adoption programs (again requires more staff and travel)
- Sometimes will continue to operate aid programs in countries where international adoptions have closed such as Guatemala or Cambodia.
Now maybe you’re thinking “That’s all well and good, but I can’t really afford to pay more in agency fees because they have to pay a lot of staff. I’m all for donating to charity but I can donate money to my own charities after I have this adoption paid off!” Every family will have different priorities when choosing an agency, so it is important to decide what is most important to you and choosing an agency based on that. For some families ethics and humanitarian aid are a priority while for others it is keeping the adoption costs as low as possible, or which agency will match them the fastest. We will discuss priorities more in the next post.
While a smaller agency might have lower fees, smaller agencies can end up with more profit per adoption than a larger agency with higher fees because of the higher operating costs for larger agencies. One large agency told me that they actually lose money per adoption, but they are able to make up the difference because they have other sources of income such as investments, heritage camps, and major fundraiser activities (this information was verified by an independent audit of their finances). However, while smaller agencies might have a greater profit per adoption, they operate on a much smaller profit margin and don’t other sources of revenue to offset their costs.
Generally, smaller agencies seem more likely to use the travel costs as a way to generate more income. Since most people focus on whatever is labeled “agency fee” on the cost sheet, and because travel costs vary by time of year so much, it is easier to hide some extra fees in that column. As I wrote in the last post, larger agencies can use their travel groups to obtain group rates at hotels or with guide services. Smaller agencies aren’t able to do this. This is a generalization that doesn’t hold true for all agencies however, so use the questions in the travel section to try and figure out if you will be facing unexpectedly high travel costs with an agency that seems to have lower fees overall. One good question to ask to try and determine if the agency is padding the travel portion is “Will I be able to receive an itemized receipt for the travel costs?”
Why am I giving you this general information about operating costs? Because there is a lot of money involved in international adoption. When you’re running low on funds and feeling stressed it is very easy to feel that the agencies are all about the money. “Someone out there probably is getting rich off of adoption!” But for most agencies, big or small, the decrease in international adoptions paired with rising overseas costs means that they are doing all they can to stay in business. Agencies can and do close and the reality is that they need to bring in some money in order to stay in the black. You need to use your financial resources the best you can so that you can bring home your child, and similarly your agency needs to use their financial resources the best that they can so that they can continue to help children find families.
In the next post, the final in this mini-series, Kelly summarize the main factors to consider when comparing agencies, with some ideas to help you rank the services you consider most important, to help you in making your final agency decision.
– photos by Stefanie
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