Donor-Advised Funds Offer Opportunity This Giving Season 

It’s giving season and in the last weeks of the year, opportunities abound for nonprofits, funders, and individual donors alike. Approximately 31% of all annual giving occurs in December, with 12% taking place in the final three days of the year. And the total amount of giving in December is considerable, with approximately 28% of non-profits raising half of their annual funding this month. The key is to act quickly! 

While individual giving has been on a downward trend in recent years, giving through donor-advised funds, or DAFs, is gaining momentum. The latest numbers put the total DAF treasure chest at $251 billion. In 2023 alone, more than $59 billion were deposited in DAFs, according to the National Philanthropic Trust.  

In a nutshell, a DAF is a bank account for philanthropic dollars. It can accommodate any form of funds, including stocks and other assets. Once an asset goes in a DAF, the owner gets an automatic tax deduction, and the assets are then forevermore earmarked for philanthropic purposes. Yet there is no mandated payout requirement, so what was intended as a type of checking account for annual giving is often more akin to a savings account, with assets gaining in value while sitting in the bank. Total annual distributions from DAFs have hovered around 20-25% for years, higher than payouts from private foundations, but still held back from the incredible power that could be unleashed if these funds were rapidly deployed to frontline organizations providing critical services in communities across this country, and around the world.  

Imagine the progress $251 billion in donor advised-funds could advance if that funding were unlocked—from tackling homelessness and addiction on our streets to building economic opportunity for young people everywhere.  

For Nonprofits:

• Make DAF giving easy. Add a widget to your fundraising page so that donors can give with one click. If they need to jump through hoops to give money from their DAFs, they may put off giving, or not give at all. There are lots of tools to choose from, including DAF Direct, Chariot’s DAFpay, Infinite Giving DAF widget and Daffy for Nonprofits, to name just a few. Choose the one that’s right for you.  

• Talk to your stakeholders—your friends, family, allies and board members—about DAF giving. Share DAF giving opportunities in your fundraising materials and reports. It is not too late to send out a quick pre-holiday appeal that spotlights quick and easy giving opportunities on your website for DAF donors.  

• Identify, track and cultivate DAF donors, wherever possible. According to Chariot Payments’ DAF Fundraising Report, 26% of DAF donors were already supporting the nonprofit in question when they made their first DAF gift. This means you likely have DAF donors in your database and address book already. More importantly, they found that when an individual starts giving from their DAF, versus a check or credit card payment, their annual giving increases by 96%.  

For Foundations:

• Double down on your top priorities. Consider providing matching funds for DAF contributions that increase engagement and speed donations to the organizations and issues you fund. #HalfMyDAF is a great example of a strategic matching initiative that is working to unlock DAF funds and deploy them for immediate impact.  

 • Spread the word. Nonprofits with dedicated DAF donor strategies are few and far between. Share information with the nonprofits you support about the fundraising opportunities available through DAF donors. This will bring in additional dollars to advance your top priorities and help your partner organizations diversify their funding streams, making them more sustainable and resilient.   

This December, in this season of generosity, nonprofits, foundations and individual donors can come together to change the story around DAFs. The joy of giving is not about putting resources in—it’s about moving resources out and putting them to work to create impact, today.