Donor-Advised Funds

What works — and what doesn’t — when building ties with financial professionals to attract DAF gifts.

The three most popular grantees in 2022 were Doctors Without Borders USA, St. Jude Children’s Research Hospital, and World Central Kitchen.

Foundation giving was 15 times greater in the year after the pandemic struck. But the emphasis on immediate relief worries experts, especially as climate change makes natural disasters more frequent and devastating.

It would be the first year since 2018 that the value of grants from its donor-advised funds exceeded the value of investments going into the funds.

At a time of increased criticism about how the philanthropic world operates, congressional legislation aimed at reining in DAFs needs to go further. Among other things, it should address issues such as the funds’ lack of transparency and their tax advantages over foundations.

The study also found that people across the political spectrum want to speed money to charities from foundations and donor-advised funds.

Despite controversies swirling around donor-advised funds, efforts aimed at speeding money from DAFs are of minimal interest to most fundraisers. On a recent well-attended webinar on managing and using gifts from the funds, the subject didn’t even come up.

The study found the biggest share of gifts to meet faith obligations went to international organizations.

Supporters say the proposal would direct more money from private foundations to charities every year. Critics say it would undermine donor privacy, among other harmful effects.

But of small funds, nearly 80 percent distribute money to charities rapidly enough to deplete the initial contributions to those accounts, according to a new study of a limited number of account sponsors. The data can be helpful to fundraisers as well as policy makers.