Learn about how to use Donor Advised Funds as a philanthropic vehicle from Liz Yoder, former L’Arche assistant turned Certified Financial Planner.
Financial planning clarified as a meaningful career to me when I realized that I get an opportunity to talk with people every day about what is most important to them.
I enjoy chatting about charitable giving when questions arise about how clients can make the most impact with the life and resources they have been given. One thing that I have started to use for my own giving to is a Donor Advised Fund.
A Donor Advised Fund is essentially a charity set up by an individual or family to save for future charitable gifts or grants. Most people use a DAF to take advantage of increasing their ability to itemize their taxes in a given year or to remove highly taxable stocks from their taxable investment portfolio, to be used for charitable giving.
I personally choose to use my DAF as a cash flow planning tool. Since I don’t have months of excess cash, I give monthly. This way, I can increase the impact of my gifts throughout the year while accumulating my own savings.
Here are a few reasons why establishing a monthly giving plan to a DAF may be helpful:
- You want to minimize the impact of your annual giving on your own bank account
- You want to reduce the impact of monthly fees L’Arche has to pay to run your credit card
- You want to reduce the amount of exchange losses that your local organization will have to pay when giving to an international organization (from currency discrepancies and international exchange fees)
- You want to give a more significant gift to a specific campaign
A DAF can act as regular annual giving or as a charity emergency fund, where money is set aside for those times of crisis or joy that you want to support in a one-time gift.
One last idea to consider is anonymity. While I don’t make anonymous gifts, I know that many prefer not to share their generosity with others who know them. With a DAF, donors have the opportunity to pick a creative name unrelated to their family name so that any gift they make will not be traced back to them, but they will see their DAF listed as a donor to the organization. The organization will try to reach out to the DAF by sending a contact to the fund administrator, but the individual’s identity would remain anonymous.
Personally, I have always enjoyed staying connected to organizations I love through recurring giving. When I worked as a L’Arche assistant, I learned to connect financial decisions with my personal values. I used a Donor Advised Fund as an intentional tool to keep myself honest on my giving goals, which includes helping L’Arche to grow.
Liz Yoder worked as a L’Arche assistant at L’Arche GWDC’s Highland House in Arlington, Virginia. Determined to work for families and individuals who were often scared to save or earn too much to disqualify them for government benefits, Liz became a CERTIFIED FINANCIAL PLANNER™ professional to advocate with them. As Director of Financial Planning at Planning Across the Spectrum, Liz and her colleagues serve clients across the country, many with high support needs and many with few. The company’s goal is to provide pathways more financial wellness and inclusion for neurodivergent individuals and others with disabilities.