There are many options if you’re looking for the best donor-advised fund software in 2024.
You can undoubtedly look at every single one of them, but it’s not necessary. The top donor-advised funds offer the same basic functionality. The choice comes down to which provider is really in service to the nonprofits donors want to support, offering the service, convenience, and flexibility the company and its donors require.
DAFs are no longer just a tool for the uber-wealthy. Individuals can use them as well. One of the easiest ways to do this is through a corporate giving platform.
Donor-advised funds (DAFs) provide a simple solution to support tax-deductible contributions. They are similar to a charitable foundation without the fuss. In fact, one of the best things about DAFs is how much of the money goes to work for nonprofits.
Although foundations beat DAFs hands-down with 900% more in assets, DAFs comprise 42% of the giving. In addition to being more cost-efficient, DAFs don’t require public disclosures like foundations.
As mentioned, many of the features and benefits are the same when you’re comparing the top contenders. Most donors will be concerned with fees and minimums that allow them to maximize their charitable contributions. In this article, we’ll compare Groundswell, Greater Horizons, Schwab Charitable and Vanguard Charitable.
Fees: Donors pay no annual fee.
Minimums
Value Proposition
Groundswell is the cost-effective option with no fees and a $1 minimum contribution amount. It offers a superior user experience in a mobile technology platform.
Fees: Annual administration fee 0.60% or $100
Minimums
Value Proposition
Fidelity offers a set of tools that helps donors find places to donate to and keep track of their donations. However, the annual cost of administration turns people away to other options.
Fees: Greater Horizons has a $500 minimum annual fee and is tiered according to the balance but pricing is not available online.
Minimums
Value Proposition
Greater Horizons is a good option for those who don’t want the constraints of minimums. However, the signup process is largely manual.
Fees: Schwab has a $100 minimum annual fee and is tiered according to the balance. Fees are the second cheapest for accounts under $25,000.
Minimums
Value Proposition
Schwab offers an easy signup process but you’ll need a Schwab brokerage account and the DAF has limited customer service hours.
Fees: Vanguard has a $250 minimum annual fee and is tiered according to the balance. Fees are the second cheapest for large accounts.
Minimums
Value Proposition
Although Vanguard has lower fees than some, the minimum contribution amount is one of the highest.
As mentioned, the main reason DAFs are so popular is that they offer tax advantages. Much like a retirement account, DAF account funds can be invested in appreciable assets and these investments grow tax-free. Donors, themselves, can donate non-cash assets, both privately and publicly held, for the full cash value without having to pay capital gains taxes. So, the donor gets a tax break and once they decide to disburse the funds to a non-profit, there may be more money to give. DAFs used to be available only to the wealthy and were sometimes exploited to pass wealth on to future generations without tax implications.
The biggest advantage of the Groundswell option is its affordability and accessibility. Groundswell democratizes DAFs for all. With Groundswell, every employee can have a donor-advised fund. In addition to boasting the lowest operating costs, Groundswell is doing a few other things differently. The Groundswell philanthropy-as-a-service platform decentralized the process, making it easy for employees to
Groundswell puts it all in a mobile-first app available on iOS and Android. It’s even easier for companies. They can include DAF contributions as a component of their overall compensation packages. Employee donations are safe, secure, and confidential.
With Groundswell, your employees can be assured that what’s important to them is important to you. Like to know more? Contact Groundswell today.
