Asset Fundraising: DAFs, Stocks, and Bequests
Community foundations are nonprofit organizations that award grants within a specific geographical area. In the Dallas/Fort Worth area there are five that I’m aware of:
- Communities Foundation of Texas
- Dallas Foundation
- North Texas Community Foundation
- Southwest Community Foundation
- Texas Women’s Foundation
Why do I lead with this information? Because community foundations hold significant assets in Donor Advised Funds (DAFs). But they are not the only ones. Investment companies such as Fidelity Charitable, Schwab Charitable, and Vanguard Charitable, to name just three, also manage DAF wealth.
I recently learned about the dafwidget offered at no cost by MarketSmart. (https://dafwidget.com/) that makes it easy for donors to make their donation with their DAF account. I haven’t tried it yet. Let me know what you think.
Other asset-based donations include stocks and bequests. DonateStock is a third-party organization that will process gifts of stock (https://donatestock.com/for-nonprofits). A nonprofit adds a link on their website to DonateStock where the transaction takes place. This is a cost-effective alternative to having a stockbroker and brokerage account.
Donors will consider bequests in their wills and estate plan when you let them know your organization has the capacity to accept them. I often hear from clients that they don’t know how to find out who has DAFs or stock or an estate plan. The first thing I ask the nonprofit leader is, “did you ask your donor if the have a DAF, or stock, or a will.” Donors will tell you if you ask. You can ask in person, one donor at a time, or you could send a brief survey to your donors, asking if they would like to make a gift to your organization through a DAF or stock or bequest.
Donations from assets are relatively painless for donors and may offer some tax benefits. Gifts from assets are oftentimes larger than gifts from a personal bank account, which can make a greater impact for the nonprofit.
Taking a cue from the marketplace, nonprofit leaders and fundraisers should make donors’ experiences pain free, friction free and as seamless as possible. Make it easy for them to support your organization and let them know you appreciate their support; however, they decide to give.
Lastly, donors who feel appreciated will share the good news about your organization. Donors who don’t feel appreciated could share their negative feelings. Gratitude should be central to your donor communications.
Resources:
https://donatestock.com/for-nonprofits
https://www.nptrust.org/reports/daf-report/
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