The High Price of Ignoring Donor-Advised Funds

Written By Emily Weisgrau

This headline from a HigherEdJobs article stopped me in my tracks:

“Why Your Institution Should Be Talking About the $120 Billion in Donor-Advised Funds”

Since the article was published last September, the number has actually grown. This week, the National Philanthropic Trust reported it's up to $142 billion.

I helped to raise some tiny fraction of that massive sum when I was a development officer at The Philadelphia Foundation. We touted the benefits of donor-advised funds (DAFs) over private foundations:

Give now, get a tax deduction now, and decide where to give later.

But for many, later still hasn’t arrived. And if not now, when?

Community foundations and financial institutions that sponsor DAFs have wonderful philanthropic advisors on staff to help donors make decisions about how to use funds.

But your nonprofit organization, college, or university needs to be proactive in encouraging DAF distributions. 

Recommendations for securing more DAF gifts:

The article features Half My DAF founders Jennifer and David Risher, who suggest: 

“Two keys to tapping into DAFs is knowing which donors are giving from DAFs, and making it easy for these DAF holders to give from their DAFs.”

They recommend keeping track of DAF donors in your database and adding the DAFDirect widget to your giving website. 

I would add:

  • Create a targeted matching or challenge campaign just for donor-advised funds.

  • Create a donor-advised fund segment for annual giving appeals.

  • Include donor-advised funds in the “ways to give” section of your website.

  • Report back on impact, including for unrestricted gifts. Some donors give through donor-advised funds in order to remain anonymous, but you may be able to send communications via their funds’ sponsoring organizations.

 
Emily Weisgrau
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