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Donor Advised Funds (DAFs) have grown in popularity in recent years. In 2008, DAFs in the United States accounted for just 4% of individual giving, compared to 27% of individual giving in 2022. Park City Community Foundation is proud to be a part of this increase as we manage Donor Advised Funds for engaged philanthropists in our community.
What Is a Donor Advised Fund?
A Donor Advised Fund is a giving vehicle that many people use as an alternative to having their own private foundation. They have much lower administrative costs, they are easy to set up, and are a very flexible way to receive immediate tax benefits while also donating to causes you love now and for years to come.
DAFs are an important tool for philanthropists and the charitable causes they support. They make it easier for donors to give non-cash gifts and, when the markets are strong, they enable donors to contribute larger gifts. DAFs are also a great way to ensure ongoing support that makes planning easier for nonprofits, and therefore enables organizations to increase their impact.
How Can Donor Advised Funds Make an Impact?
According to the National Philanthropic Trust, there are nearly 2 million open Donor Advised Fund accounts in the United States. Most notably, charitable assets held in these accounts currently total $228.89 billion — and growing. From the end of 2022 to the end of 2023, there was a 41% increase in DAF assets, according to Ren Charitable Foundation.
This philanthropic growth is meaningful. Individuals and families are contributing to their Donor Advised Funds and those dollars are ready to be deployed to organizations making real impact. More money means more resources for nonprofits to add depth and breadth to their work.
We believe it’s time to move dollars from DAFs to our community’s nonprofits. Imagine the positive impact that could happen if we saw a 41% increase in dollars contributed to nonprofits in 2024!
Donor Advised Funds do not have any legal requirements to give (in contrast to private foundations that are required to give 5% of their assets every year). At Park City Community Foundation, we are grateful to work with active philanthropists. On average, Park City Community Foundation DAF holders granted 20% of their funds in 2023, compared to a national average of 18%. Removing inactive accounts, this statistic jumps to 42% for Park City Community Foundation’s active DAF holders. This is notable! It also leaves room for improvement.
We encourage anyone who has a DAF to move those assets and not let them languish. The most exciting part of being a DAF holder is to make grants.
Park City is facing major development opportunities, a future Olympics, and areas of economic growth. With so many pending changes, now is the time to invest in our community. To ensure sustainable growth that maintains the characteristics that make Park City the place we all love, we must support the nonprofits doing the work on the ground. We must activate dollars from DAFs.
Where Could the Money Be Going?
One of the benefits of holding a Donor Advised Fund with Park City Community Foundation is our engagement with all local nonprofits. We hold close relationships to introduce you to the causes you care about most.
Locally, some of the greatest areas of need we have identified as both vital and actionable include climate, early childhood care and education, affordable housing, and equitable access to sports and recreation. You can directly support these areas of need by making a gift to Park City Community Foundation or to our initiative funds.
We are also able to send funds to any 501(c)3 organization, near and far, to help meet your philanthropic goals. Our expertise in long-range investing and giving means you’ll get the maximum return on every dollar you donate using your DAF.
Many employers will also match grants made from DAFs, but not contributions made into DAFs. Be sure to check with your employer about potential matching gifts.
Reach out to Alexis Brown, alexis@parkcitycf.org, 435-731-4303, to start a Donor Advised Fund or make a grant from an existing DAF today! Together we can make local impact and ensure a thriving community.