Making a Greater Impact
It feels good knowing that we can make an impact in others’ lives, but as I grew in my personal journey of generosity, things began to get more complicated. As I started to give more, the number of charities I support began to grow as well. More charities means writing more checks and more receipts to track come tax time. Instead of enjoying the process of helping others, it started to become another burden.
Then I was introduced to Donor Advised Funds
A Donor Advised Fund is kind of like a personal family trust without all the costs and legal requirements. It acts just like a charitable checking account. I am able to put cash, stocks, mutual funds, and even business interests and real estate into my Donor Advised Fund, which gives me a tax deduction in the year I contribute. Then I can decide when and how much I want to grant out to the charities I care about. I am able to set up recurring monthly gifts, and grant out one time gifts when I feel led. I also have the option to grant anonymously to an organization. The most convenient part is that by giving to my donor advised fund and then granting out from there, I only receive one receipt at tax time, saving me hours of tracking down, filing, and accounting for all the receipts.
Simplify Giving Now; Create a Future Giving Legacy
Soon, my wife and I hope to have our six children involved in aspects of the donor advised fund, and let them decide what types of organizations resonate with our family. This creates an additional benefit of passing down the value of generosity to the next generation. CareNet is one of the non-profit organizations we support. Learn more about how to get involved at CareNet.
How Do I Get Started?
Many different organizations offer donor advised funds, including Fidelity and Vanguard. Two of our lesser known favorites are The National Christian Foundation (ncfgiving.com) and American Endowment Foundation (aefonline.org). Over the years, we have taught our financial planning clients about the merits of donor advised funds and watched their involvement and passion for giving increase under this strategy. We’ve been honored to help them give about a million dollars to their charities of choice, in a more streamlined and tax-efficient manner. Start with your personal financial advisor. If they are unfamiliar with the concept, we are happy to bring them or you up to speed.
Giving should be part of everyone’s financial plan, and HOW you give can make a big impact on your taxes as well as your time! We hope you look into this and find the Donor Advised Fund to be as simple and rewarding as we have.
Toby Meisenheimer, CFP, is the Founder of Streamline Financial Services in Warrenville, IL. Streamline manages $180 million in assets for their wonderful clients. He and his wife and five beautiful kids (plus one average-looking kid who looks a lot like Toby) live in Winfield, IL. He does not enjoy running at all, falls asleep regularly during reading, and hopes to live alone with his wife again someday.