Donor-advised fund generosity increases with time: Vanguard Charitable

Donor-advised fund generosity increases with time: Vanguard Charitable
Donors who have had their accounts for 10 years or more last year issued grants that were 61% larger on average than those from donors with a tenure of six years or less. 
MAY 01, 2023

A study of donor-advised funds shows that time matters too.

According to donor-advised fund sponsor Vanguard Charitable’s survey, established DAF donors give more, and more consistently, on an annual basis than new DAF donors. Results of the report, "Why Giving Matters," suggest that opening a DAF leads to more effective giving practices over time.

The study showed that 71% of donors who have had their accounts for 10 years or more give in larger amounts as a result of their DAF, and 68% agree they give more consistently to their favorite charities with their DAF. The report also showed that accounts with at least 10 years of tenure give significant amounts to grantees on an annual basis, about $17,000 more on average in 2022 than accounts with tenures of six years or less.

"We are so inspired by our donors’ continued generosity," Rebecca Moffett, president of Vanguard Charitable, said in a statement. "The trends we see here reinforce the exponential impact DAFs have on nonprofits the longer an account is active.”

Moffett added that donors indicate their strong charitable commitment when they open a DAF, and that commitment is refined over time.

Across all tenure groups, the study revealed that more than two-thirds of DAF donors reported giving more effectively because of their donor-advised fund. That said, donors who have had their accounts for 10 years or more issued grants that were 61% larger on average in 2022 than grants from donors with a tenure of six years or less. 

Renae Ransdell, a wealth advisor at SageView Advisory Group, says that charitably inclined individuals are going to give regardless of the tax benefits. However, most prefer to give in a tax-efficient manner if that's an option.

“For our clients, donor-advised funds are a meaningful resource to fulfill their charitable goals while realizing some tax benefits," she said. "Once funded, their DAF takes the pressure off tax planning, allowing clients to focus on the causes important to them and advise on how those assets are directed.”

Latest News

RIA moves: True North adds $353M California RIA as SageView grows North Carolina presence
RIA moves: True North adds $353M California RIA as SageView grows North Carolina presence

Plus, a $400 million Commonwealth team departs to launch an independent family-run RIA in the East Bay area.

Blue Owl Capital, Voya strike private market partnership for retirement plans
Blue Owl Capital, Voya strike private market partnership for retirement plans

The collaboration will focus initially on strategies within collective investment trusts in DC plans, with plans to expand to other retirement-focused private investment solutions.

Top Commonwealth advisor to recruiters: Stop with the cold calls already!
Top Commonwealth advisor to recruiters: Stop with the cold calls already!

“I respectfully request that all recruiters for other BDs discontinue their efforts to contact me," writes Thomas Bartholomew.

Why AI notetakers alone can't fix 'broken' advisor meetings
Why AI notetakers alone can't fix 'broken' advisor meetings

Wealth tech veteran Aaron Klein speaks out against the "misery" of client meetings, why advisors' communication skills don't always help, and AI's potential to make bad meetings "100 times better."

Morgan Stanley, Goldman, Wells Fargo to settle Archegos trades lawsuit
Morgan Stanley, Goldman, Wells Fargo to settle Archegos trades lawsuit

The proposed $120 million settlement would close the book on a legal challenge alleging the Wall Street banks failed to disclose crucial conflicts of interest to investors.

SPONSORED How advisors can build for high-net-worth complexity

Orion's Tom Wilson on delivering coordinated, high-touch service in a world where returns alone no longer set you apart.

SPONSORED RILAs bring stability, growth during volatile markets

Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today's choppy market waters, says Myles Lambert, Brighthouse Financial.