Charitable giving is often a key pillar of estate and legacy planning for many investors. If philanthropy is important to you, consider the following details of donor-advised funds and evaluate if they make sense for your plans to support causes that matter most to you.
What is a donor-advised fund? A donor-advised fund (DAF) is a monetary fund or charitable account managed and operated by a sponsoring organization, commonly a 501(c)(3) nonprofit, religious or financial entity. Contributors to a DAF make an irrevocable donation to the fund that is managed by an investment professional in accordance with the fund’s long-term goals and objectives. The donor is then able to advise the fund manager on which organizations and grants to allocate the money to.
What can be donated to a DAF? One of the attractive features of a donor-advised fund is that multiple appreciating asset types, such as publicly traded securities, mutual funds, restricted stock and cash, can be donated to the account…