Unlocking the Power of DAFs: How Funders Can Overcome Psychological and Operational Barriers and Use Donor-Advised Funds More Effectively

Drew Rabe and Betsy Erickson

Donor-advised funds have become increasingly popular over the last 30 years, and for good reason: they are easy to use, have a low barrier to entry, and offer instant tax benefits. However, without a proper plan and additional structures and strategies in place, DAFs can end up keeping large quantities of money on the sidelines that could otherwise be supporting urgent social change efforts.

Despite these apparent constraints, when used to their fullest potential, DAFs can offer a flexible, impactful, and streamlined way for donors to maximize their giving. Our latest report shares five proven tactics for overcoming the psychological barriers donors may face when using DAFs, as well as strategies for avoiding operational limitations on effective DAF giving, ensuring this popular giving vehicle can deliver on its promise of enabling greater impact for changemakers of all kinds. The report also includes a case study that illustrates how these five tactics may look in practice.

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