Big donor-advised funds see big jump in contributions

Giving to donor-advised funds and other umbrella organizations such as the United Way increased last year. At the same time, however, support for foundations declined from 2010 levels, according to the 2011 Giving USA report released on Tuesday. The annual estimate on U.S. philanthropy, which showed that total giving rose 4% to nearly $300 billion in 2011, also found that contributions to donor-advised funds and other groups that redistribute money to charitable organizations grew by 4% last year to $21.37 billion. The nation's three largest donor-advised funds, Fidelity Charitable Gift Fund, Schwab Charitable Gift Fund and Vanguard Charitable Gift Fund, realized an average of 77% growth in contributions from 2010 to 2011, the Giving USA report said. “What's stunning is that many more dollars are going to the freestanding donor-advised funds, while the total going into foundations is coming down,” said Kate Roosevelt, executive vice president of the Collins Group, a fundraising consulting group. Foundations, which families, companies or others create for charitable giving, received $25.83 billion in total contributions in 2011, about 6.1% less than they received in 2010, the report said. Overall, foundations received about 9% of charitable gifts in 2011, while donor-advised funds and other umbrella groups received 7% of the total, the report said. “More donors are finding it convenient to use a donor-advised fund instead of a foundation,” said Melissa Berman, chief executive of Rockefeller Philanthropy Advisors. “In addition, people often put money into foundations when they have a significant infusion of capital, like the sale of a business or an investment that has done well, and the last year most investments haven’t done well.” Individuals provided 73% of the total giving in 2011, a 3.9% rise over 2010, however, giving as a share of disposable income remained at 1.9% in 2011, the same level during the two previous years, the study said. “Charitable giving, like other spending categories in the average American household budget, seems to be climbing out of the trough that resulted from the Great Recession, much like some other indicators measuring the state of the economy,” said Jim Yunker, chair of Giving USA Foundation. Religious organizations continued to be the biggest recipients of charitable funds, garnering 32% of the total. The amount going to religious organizations, however, declined by 1.7% to $95.88 billion last year.