Editor’s Note: Over the past few months, Inside Philanthropy has run a number of guest posts about donor-advised funds, with contributors weighing in on all sides of the issue. This latest post is by the president of the Jessie Smith Noyes Foundation. We invite further contributions to this series.
The Jessie Smith Noyes Foundation’s Donor-Advised Fund Campaign urges donors to distribute their charitable dollars in a more timely fashion. DAFs are great vehicles to foster more charitable giving. In fact, surveys indicate that two-thirds of individuals with donor-advised funds give more than they would have if they did not have these funds.
The downside is that the money earmarked for charities is not getting disbursed in a timely fashion. Donors take an immediate tax deduction but have no corresponding responsibility to make timely distributions of their charitable dollars to nonprofit organizations.
Over $50 billion now sits in donor-advised funds. With the popularity of DAFs, that amount will substantially grow each year. This is an incredible amount of money that can be used to ease societal problems and have a positive impact in the world.
The Noyes Foundation believes that money has to get to work sooner.
We specialize in grantmaking to U.S. grassroots organizations working to change environmental, social and economic conditions to bring about a more just, equitable and sustainable world. Our experienced team has a comprehensive understanding of social justice issues and how social change occurs.
We are partnering with individual donors to increase funding and awareness for social justice causes such as sustainable food systems, reproductive rights and environmental justice. After conferring with donors, the foundation makes recommendations of vetted, nonprofit organizations based on its knowledge and understanding of the social change process. If interested, the donors can then fund these nonprofits directly through their donor-advised funds or other giving mechanisms.
We believe we also can be of value to wealth advisors who are often asked for giving advice by their clients. Our knowledge of and experience with social justice nonprofits can be an effective resource for these advisors, providing them with broader options to meet the philanthropic interests of their clients.
Donor-advised funds are a viable way of allocating dollars to charities but nonprofits should not have to wait indefinitely to receive these monies. Pressing issues need immediate attention to maximize change.
Two-thirds of the organizations we support have annual budgets under $750,000, so a contribution of any size is a significant one that can help them have an impact.
People with donor-advised funds want to make a difference with their philanthropy. We do, too, and that’s why we want to help them identify causes and nonprofits that are consistent with their giving philosophy. Together, we can make an impact sooner rather than later.