Giving with Purpose: What Donors Should Know About Donor Advised Funds (DAF)

When it comes to charitable giving, most people think of writing a check, donating online, or dropping something in a collection plate. Those are all meaningful ways to give. But there is another tool that more and more donors are using to make their generosity go further, and it is called a Donor Advised Fund, or DAF.

You may already have one. Or this may be the first time you are hearing about them. Either way, read on.

Why Individual Donors Matter More Than Ever

People everywhere are looking for ways to make a real difference. And right now, that desire to help could not be more timely.

The foundation and grant landscape is increasingly competitive and difficult to navigate. Nonprofits across the country are feeling the pressure, and organizations like Embolden WI and our fiscally sponsored partners are counting on individuals to step up. Institutional funding alone cannot sustain the work. Individual donors, people who believe in a cause and choose to act, are what make it possible.

A DAF grant is one of the most powerful ways you can respond to that moment. It is direct, it is meaningful, and it goes exactly where you intend it to go.

What Is a Donor Advised Fund?

A Donor Advised Fund is a charitable giving account that you open through a sponsoring organization like Fidelity Charitable, Schwab Charitable, Vanguard Charitable, or a community foundation like the Madison Community Foundation.

Here is how it works:

You contribute money (or assets like appreciated stock) to your DAF and receive an immediate tax deduction. Then, whenever you are ready (this year, next year, or years from now), you recommend grants to the nonprofits and causes you care about. The sponsoring organization sends the money on your behalf.

Think of it like a charitable savings account: you fund it when it makes sense financially, and you give from it when it feels right.

DAF giving has grown dramatically in recent years. According to Candid, there are now nearly 690,000 DAF accounts nationwide holding close to $350 billion in assets. And account minimums have largely disappeared, meaning this tool is no longer just for major donors. Anyone who gives intentionally can benefit from one.

Why Donors Are Choosing DAFs

Whether you already have a DAF or are considering opening one, here is why so many donors find them valuable:

Flexibility. You do not have to decide where to give at the moment you make a contribution. You can take your time, research causes, and give thoughtfully, on your own timeline.

Tax efficiency. Donating appreciated stock or other assets directly to your DAF lets you avoid capital gains taxes while still receiving the full charitable deduction. This can meaningfully stretch the impact of your gift.

Simplicity. Instead of tracking receipts from a dozen organizations at tax time, your DAF records everything in one place.

Momentum. Money contributed to a DAF is irrevocably committed to charitable giving. It is already out of your taxable estate and designated for good, which has a way of making the giving feel more intentional.

If You Already Have a DAF: Your Giving Can Go to Work Right Now

For those who already have a DAF account, here is something worth sitting with: of the nearly $350 billion held in DAF accounts nationwide, a significant portion has not yet been granted out. Donors contribute with good intentions, and then life gets busy.

The causes you care about are still out there, still doing the work, still needing support.

If your account has been sitting dormant, consider this a gentle nudge to put it to work. The organizations and ventures you believe in, including those Embolden WI is proud to support right here in Wisconsin, are ready to receive your gift today.

How DAF Giving Works with Embolden WI

Embolden WI is a 501(c)(3) fiscal sponsor supporting a growing community of ventures working for a better Wisconsin. Our fiscally sponsored partners, including initiatives like PATCH and ECCHO, are eligible to receive DAF grants because Embolden holds the legal 501(c)(3) status on their behalf.

If you have a DAF and want to direct a grant to one of our partners, the process is simple:

1. Log into your DAF portal (Fidelity Charitable, Schwab Charitable, your community foundation, etc.)

2. Search for Embolden WI using our EIN: 80-0287566

3. Enter your chosen venture in the memo or purpose field such as, "For the benefit of PATCH" or "For the benefit of ECCHO"

4. Submit your grant recommendation

Embolden WI receives the grant and transfers the funds directly to your chosen venture. The memo line is what ensures it gets to the right place, so do not skip it.

One important note: DAF grants cannot be used to fulfill pledges or purchase event tables. They are grants, not payments, and that is part of what makes them so powerful.

A Note on Timing

DAF grants typically process within a few business days to a couple of weeks, depending on the platform. If you would like your gift to reach a particular venture by a specific date, we recommend initiating the grant a few weeks in advance.

When your grant arrives, Embolden WI will send you a gift acknowledgement letter. Some DAF platforms share limited donor information with recipient organizations, so if you would like the venture you are supporting to know the gift came from you, consider reaching out to them directly. Your generosity matters. The people doing this work notice it. And they want to thank you.