Maximizing DAF gifts: 5 practical tips for nonprofit leaders

By Steve Anseth, CPA

I recently participated in a webinar focused on donor-advised funds (DAFs), and the discussion highlighted several compelling trends that nonprofit leaders should pay attention to. Perhaps the most striking takeaway was the data around DAF giving: the average grant from a DAF is significantly larger than a typical direct donation from an individual donor. In addition, many donors who give directly to organizations also maintain a donor-advised fund and use it as another vehicle for their charitable giving.

For nonprofits, this represents a largely untapped opportunity. As the number of donor-advised funds continues to grow, organizations that intentionally incorporate DAF strategies into their fundraising efforts may see meaningful increases in giving. Below are five practical steps nonprofit leaders can take to better position their organizations to receive DAF gifts.

 

1. Include DAF Sponsors in Your Marketing Outreach

Make donor-advised funds visible in your fundraising communications. When sending paper-based appeals, include clear instructions for how donors can recommend a grant through their DAF. Many donors already have funds available in their DAF accounts—they may simply need a reminder that your organization can receive those grants.

 

2. Make DAF Giving Easy on Your Website

If your website includes a “Donate Now” button, consider adding information and links specifically for donating through a DAF. Some organizations also add tools such as DAFpay, a fee-based platform designed to simplify recommending grants directly from a donor’s DAF account. Making the process simple increases the likelihood donors will use this giving method.

 

3. Decide How to Track DAF Gifts in Your Donor Database

Organizations should determine how DAF gifts will be recorded in their donor management system. Some nonprofits apply soft credit to the donor advisor, while others use hard credit. In practice, many donors both give directly and recommend grants through a DAF, so your tracking approach should allow you to recognize and understand the donor’s full giving relationship with your organization.

 

4. Acknowledge DAF Gifts Appropriately

DAF grants should always be acknowledged to the individual who serves as the advisor to the fund. However, the acknowledgment language should be adjusted. Instead of thanking the donor for a direct contribution, thank them for recommending a grant from their donor-advised fund and express appreciation for their continued support of your mission.

 

5. Participate in DAF Day

Another opportunity to raise awareness is DAF Day. Always falling on the second Thursday in October, DAF Day is an annual holiday bringing awareness to donor-advised funds and how both nonprofit organizations and donors can benefit alike.

Many nonprofits are surprised to learn there is a day dedicated to donor-advised fund giving, but it can be a useful moment to remind supporters about this giving option. At a minimum, consider sending two to three emails leading up to DAF Day explaining what it is and providing simple instructions on how donors can recommend a grant from their DAF to support your organization.

 

A Growing Opportunity

Donor-advised funds continue to grow in popularity and are likely to remain a significant component of charitable giving. By making small adjustments to your outreach, website, gift tracking, acknowledgments, and annual fundraising calendar, nonprofits can position themselves to better capture this expanding source of philanthropy.

If you would like to discuss how Abdo’s nonprofit team can help your organization be in the best position to receive and maximize donations, contact us today.