DONOR ADVISED FUNDS CREATE OPPORTUNITY FOR IMPACT NOW AND IN THE FUTURE

Grand Rapids Community Foundation is proud to partner with many philanthropists, guiding resources of time or treasure to make impact in Kent County and beyond. Creating a fund that makes grants you recommend is one way to support your vision for our community’s future—and ensure the Community Foundation’s future adaptability.

A Donor Advised fund is a fund from which grants are made under the recommendation of its advisors. An advisor’s philanthropic goals often determine if the fund is non-endowed or endowed. Over the last decade, the number of DAFs at the Community Foundation and other providers has grown tremendously. Their popularity reflects the flexibility and control they offer fund holders.

“People looking to open a DAF do have options when it comes to a provider,” said Shaun Shira, major and planned gifts director. “We find our partners have an undeniable passion for West Michigan, and they choose the Community Foundation because they want their philanthropy to have impact in the community they love and value the benefits of working with a local provider.”

In many cases, the resources of a fund are endowed, meaning each year a percentage of the fund’s market value is used for grants. These funds are permanent and perpetual, and, after the last advisor passes away, the fund resources may be directed to the Community Foundation’s unrestricted or Field of Interest funds. The grant dollars stay in our community and grantmaking decisions are guided by the Community Foundation staff, committee members and Board of Trustees toward the most pressing needs. This guarantee sets us apart and ensures that the impact of today’s gifts will continue into the future.

Katherine Sage and Matthew Richenthal established a nonendowed fund last fall with the support of their professional advisor. By choosing a non-endowed fund, the entire value of their establishing gift is available for immediate grantmaking. Kate and Matt have young daughters, and expressed an interest in supporting education initiatives through their fund. “We were thrilled to create a Donor Advised Fund,” Kate said. “It’s perfect for giving to the local causes that are especially meaningful to us.”

Donor Advised funds also provide the opportunity for an active, effective partnership with the Community Foundation’s philanthropic services team, who can make connections to organizations and networks working in a donor partner’s area of interest. With the team’s support, fund holders can feel confident in their grantmaking.

As the number of DAFs has increased nationally, so have conversations and legislative proposals. Some believe that the funds are simply used as tax havens or that they slow the distribution of philanthropic dollars to community. However, our data shows that when our community needed it most, the Community Foundation’s donor advisors met the challenge. Between February 2020 and January 2021, our donor advisors recommended more than $6,688,000 in grant dollars—a 23% increase compared to the previous year.

GETTING STARTED

Starting a fund can be a simple process. A DAF can be created from a gift of cash, stocks or other assets. The Community Foundation offers three types of DAFs with no setup fees. We will partner with you to set up your fund in the way you prefer, and we’ll handle all investments, reporting and due diligence.

Contact the development team at 616.454.1751 to start a conversation about your philanthropic goals and establishing your legacy.