My position in the debate about whether donor advised funds are good or bad for charities is that:
1. Nonprofits must take some blame for not promoting “donor advised fund giving.”
Let’s face it, nonprofits don’t make it easy for wealthy donors to give. It’s downright impossible to find a link to a DAF widget on 99.9% of nonprofit websites. How can you complain about DAFs being only money warehouses when you don’t make it easy! Imagine if Amazon.com took the shopping cart off of the top right side of their site and then complained that people aren’t buying. Silly right? Sorry folks, nonprofits need to get with the program. Make it easy for wealthy donor to give and the money will move from the warehouses (the donor advised fund accounts) to your bank accounts. And then, finally, to where it is needed most in support of your mission.
2. The golden rule applies here. My golden rule… which is: He or she who has the gold, rules!
The donor has the right to direct their gifts (their gold) as they see fit. It’s their money. Not yours! And just because they have already received their tax deduction doesn’t mean that you can force them to give their money to you. It simply isn’t your money unless you engage with the donor, tell them what you will do with the money, ask for the money, and make it convenient for the donor to give the money to you. When I hear nonprofits demand that the money be moved immediately, I sense a tinge of entitlement. Bottom line: You should know your donors well enough to mark their record with a notation that states “has a DAF.” Then you should ask those donors to recommend your organization for a gift. If you don’t ask, you don’t get! After all, it IS the donor’s gold. And the donor, rules!
Last thing, I DO think a 5% mandate for transfers should be imposed on DAFs (same as foundations). I really don’t think that’s unreasonable.
What are your thoughts? Let the debate begin….
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