What questions should an individual donor, couple or family ask themselves before opening a Donor Advised Fund?

Before opening a DAF, families should reflect on and talk about their values and goals for their philanthropy—individually, and as a family—and their specific needs for what the vehicle should deliver. Here is a list of questions to start a dialogue among family members, perhaps with the assistance of a philanthropic advisor associated with the DAF sponsor of your choice:

History of Giving

  • What vehicles have we used for our charitable giving?
  • At what times throughout the year have we typically given, and why?
  • What motivates our giving? What issues do we care about or find concerning?
  • What have we given to in the past?
  • Do we have a close connection to a particular location or community?

Goals for Giving

  • What’s the change we would like to see in our community or chosen cause?
  • What specific goals do we wish to achieve with our philanthropy?

Family Involvement

  • What values or legacy do we wish to impart to our children and grandchildren?
  • How do we wish to involve our children and/or grandchildren in philanthropy?
  • How will we encourage their participation and make sure they feel their voices are heard?

Vehicles for Giving

  • What philanthropy vehicles have we explored, and how?
  • What do we understand are the benefits of donor-advised funds over other vehicles?
  • What are our biggest concerns when it comes to choosing a vehicle (i.e., a more formalized structure for our philanthropy)?
  • How much time do we have or want to dedicate to our philanthropy?
  • What do we value most in terms of our philanthropy or philanthropic vehicle? Examples include:
    1. Deep long-term engagement of the family?
    2. Perpetuity of the philanthropic vehicle?
    3. Working together to develop a shared philanthropic strategy and make grants decisions that reflect that strategy?
    4. To train the next generation about wealth and philanthropy?
    5. Ease and convenience?
    6. Flexibility in terms of payout and assets donated?
    7. Ultimate control of the assets?
    8. Anonymity versus openness?
    9. Low administrative costs?
    10. To be able to access and manage grants online?
    11. Access to grantmaking support and local expertise?
    12. To meet a specific goal (community-centric giving, international giving, or giving in another geographic area)?
    13. To network and/or partner with other donors or funders?
    14. Other values or needs?

Succession

  • What will happen to our philanthropic vehicle (e.g., donor-advised fund, family foundation) when I/we pass away?
  • How many generations do we wish the philanthropic vehicle to last, and why?
  • What do we imagine for the future of the family’s philanthropy?
  • What guidelines, letters of philanthropic intent, and/or legacy videos will we leave for future generations?

Next in the DAF Guide: What Questions Should Donors Ask Their Advisors when Considering Setting Up a Donor Advised Fund?


 

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Family Philanthropy and Donor-Advised Funds

This online guide is for donors and families considering donor-advised funds, as well as for others, including advisors, seeking to learn more about the benefits and complexities of this important philanthropic vehicle.

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