Giving to Fidelity Charitable’s donor-advised funds has continued to soar this year on top of a nearly 12-percent increase in 2013, which brought Fidelity closer than ever to taking the No. 1 spot on The Chronicle’s Philanthropy 400 survey of charities that raise the most money.
Last year, United Way Worldwide held the top spot by raising nearly $3.9-billion, a decline of 1.4 percent, while contributions to Fidelity (No. 2) rose by 11.9 percent, to almost $3.7-billion. Now Fidelity is reporting a 57-percent increase in contributions in the first nine months of this year, gains that seem near certain to push its fundraising totals beyond those of United Way in next year’s Philanthropy 400.
Meanwhile, grants that Fidelity account holders have made from their donor-advised funds have grown this year by 27 percent from January through September compared with the same period last year, which Fidelity officials said could signal a healthy year-end holiday giving season.
Fidelity and other donor-advised funds have been criticized for providing donors with immediate tax breaks but no requirement that they make grants from their funds. However, an annual Fidelity survey has asked account holders about the impact of having a donor-advised fund on their giving. Consistently during the last eight years, two-thirds of donors in those surveys have said they give more because they have a donor-advised fund.
Other disaster-relief efforts by organizations like the American Red Cross have benefited from Fidelity’s adoption of electronic funds transfer a year ago. With electronic funds transfer, donors can recommend a grant that will reach the recipient charity within 24 hours—much faster than mail , and cheaper for the nonprofit to process because the money goes directly to its bank account.