Donor advised funds have quickly become one of the most popular charitable giving vehicles in the U.S., according to The Chronicle of Philanthropy. In the first nine months of 2020 alone, donor-advised fund-holders at the Jewish Federation Foundation made over 300 donations to their DAFs totaling almost $700,000.
Why are DAFs so popular? Here are five reasons:
1 DAFs are easy to set up. At the Jewish Federation Foundation, a DAF can be created with just $2,500 and the balance has to remain at or above $1,000. You can contribute to it via check, credit card or stocks. Others can donate as well, so you can ask for gifts to your DAF in honor of a birthday or other occasion.
2 DAFs are your philanthropic bank account. At the end of the year, many of us pull out our checkbooks, laptops or phones to make charitable donations. With a DAF, you can make all your donations on one website with just a couple of clicks. Funds can be set aside in advance and are then available any time you want to send a contribution to a charity. In addition, you get the tax benefit when you make donations to the fund without worrying about collecting tax receipts from every organization you support.
3 DAFs are appropriate for donors of any age. Unlike many planned-giving vehicles, donor advised funds can be used by philanthropists of any age. At the Jewish Federation Foundation, grandparents have established DAFs in honor of a grandchild’s Bar or Bat Mitzvah. There are also fund-holders in their 20s and 30s using DAFs to contribute to progressive causes that they are passionate about.
4 DAFs are a family philanthropy opportunity. When you start a DAF, you can name a successor adviser – someone who will make philanthropic decisions for your fund when you are no longer able to. This creates an opportunity to have conversations with younger generations about the legacy you want to leave in the community. With a DAF in place, this successor adviser will have the resources to continue your giving.
5 Jewish Federation Foundation DAFs give back to the Jewish community. All of JFF’s DAF funds are invested with the endowment of the Jewish Alliance of Greater Rhode Island. By choosing to create a DAF with the Jewish Federation Foundation, you are investing in the Jewish community and showing your support of its mission and values.
If you are interested in establishing a DAF, please contact Sara Masri or Claire Uziel at 401-421-4111.
SARA MASRI (firstname.lastname@example.org) is chief development officer at the Jewish Alliance of Greater Rhode Island.