Donor-Advised Funds (DAFs) are one of the fastest-growing vehicles for charitable giving—but many nonprofits are still unsure how to access them.
A DAF allows a donor to contribute assets (cash, stocks, etc.) to a charitable fund, receive an immediate tax deduction, and recommend grants over time. The money stays in the DAF until the donor chooses to direct it.
Here’s how your nonprofit can tap into DAFs:
- Make It Easy: Add language to your website and donation page: “If you have a Donor-Advised Fund, consider recommending a grant to our organization.”
- Build Relationships: Engage your current donors and ask if they have a DAF. Invite them to special briefings or impact reports.
- Connect with Advisors: Financial advisors and estate planners often recommend DAFs. Educate them on how your nonprofit can make a meaningful impact.
- Host DAF Education Events: Partner with local foundations or financial institutions to offer informational sessions for donors.
DAFs can be particularly powerful for funding long-term projects, capital campaigns, or endowments. They allow donors to commit larger gifts when the timing is right for them, while maintaining flexibility in how the funds are used.
Encourage your board members and major donors to explore their DAF connections, and ensure that your EIN and legal name are listed correctly in DAF databases like Fidelity Charitable or Schwab.
With the right strategy, DAFs can become a reliable revenue source that supports both current needs and future ambitions.