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Giving through DAFs increased 27 percent in 2020, study finds | Philanthropy news

Total grant dollars awarded through donor-advised funds in 2020 increased 27 percent on a year-over-year basis, to $34.67 billion, a report from the National Philanthropic Trust finds.

Based on data from 976 DAF-sponsoring organizations, including fifty-five national charities, 603 community foundations, and 318 single-issue charities, the 2021 DAF Report found that total contributions to DAFs increased 20.6 percent, to $47.85 billion, or 10.1 percent of total estimated charitable giving in the United States last year. Total charitable assets held in DAFs grew 9.9 percent, to $159.83 billion; the number of DAF accounts rose 16.3 percent, to more than a million; and the payout rate ticked up from 22.3 percent in 2019 to 23.8 percent in 2020, while the average size of DAF accounts declined 5.5 percent, to $159,019. By comparison, approximately ninety thousand independent foundations awarded grants totaling $63.6 billion, up 17 percent on a year-over-year basis, and held $1.1 trillion in charitable assets, up 10 percent.

According to the report, national charities sponsored 864,099 DAF accounts in 2020 — an increase of 20 percent from 2019 — which awarded grants totaling $21.17 billion, an increase of 23.2 percent, with contributions totaling $33.26 billion, up 18.7 percent; assets totaling $100.15 billion, up 12.9 percent; a payout rate of 23.9 percent, up slightly from 23.7 percent; and an average account size of $115,901, down 5.9 percent. Community foundations sponsored an estimated 84,334 DAF accounts, up 0.4 percent, which awarded grants totaling $8.29 billion in 2020, a 33.7 percent increase, with contributions totaling $9.64 billion, a 41.5 percent increase; assets totaling $45.84 billion, up 9.5 percent; a payout rate of 19.8 percent, up from 17.1 percent; and an average DAF account size of $543,553, up 9 percent. And single-issue charities sponsored an estimated 56,666 DAF accounts, up 5.3 percent, which awarded grants totaling $5.21 billion in 2020, an increase of 33.6 percent, with contributions totaling $4.95 billion, up 1.6 percent; assets totaling $13.84 billion, down 6.9 percent; a payout rate of 35 percent, up from 29.1 percent; and an average DAF account size of $244,238, down 1.8 percent.

“The fifteenth annual Donor-Advised Fund Report reflects DAF donors’ initial, very generous response to the COVID-19 pandemic, calls for racial justice, and major climate change-related disasters,” said National Philanthropic Trust CEO Eileen Heisman. “Twenty-twenty was a year that defied expectations with global crises, amplified social movements, and economic disruptions due to the pandemic. What this report affirms is that DAF donors not only responded quickly but also gave with historic generosity to the causes that mean most to them….Grants grew 30 percent faster than contributions in 2020. Grant growth has outpaced contribution growth six out of the last ten years, and total annual grantmaking from DAFs has increased four-fold over the past decade.”

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One-third of donors directed half their giving to disaster relief | Philanthropy news

Last year, 37 percent of American donors gave half or more of their charitable contributions to disaster relief efforts, and 64 percent gave to a charity they had never supported before, a survey commissioned by Vanguard Charitable finds.

Conducted by the Harris Poll on behalf of Vanguard Charitable, the survey of more than 1,300 American donors found that the top reasons American donors gave to disaster relief included wanting to assist those impacted by humanitarian crises (46 percent), feeling overwhelmed by a situation and wanting to help (33 percent), seeing charitable giving as the only way they could provide support (30 percent), and having a personal connection to the disaster/crisis (30 percent). The survey found that donors who contributed to disaster relief efforts gave more overall, meaning that disaster relief giving did not take away from, or occur in place of, ongoing giving. 

“From COVID-19 to a devastating humanitarian crisis caused by the war in Ukraine, we’ve seen donors respond to disaster relief needs in inspiring and meaningful ways,” said Vanguard Charitable president Rebecca Moffett. “In fact, this data reflects that disaster relief support is an integral part of the giving landscape, often increasing total generosity as donors look to give when and where support is needed most. And because the money in donor-advised funds has already been set aside for charitable purposes, donations from DAFs tend to be more responsive in moments of crisis, and more resilient during moments of economic uncertainty.”

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Trust in nonprofits fell slightly last year, survey finds | Philanthropy news

While there is room for U.S. institutions across the board to increase public trust, a majority of respondents believe nonprofits will do what is right for society, a survey conducted by Independent Sector finds. 

Conducted in February in partnership with Edelman Data & Intelligence, the third-annual Trust in Civil Society survey found that 56 percent of Americans said they trust nonprofits, down 3 percentage points from the 2020 benchmark study (59 percent). Trust in philanthropy edged down from 36 percent to 34 percent during the same period. According to the survey, financial well-being and education are major drivers of trust, and trust of nonprofits among women fell during the pandemic.

Given the findings, Independent Sector recommended that nonprofits work to make greater progress to support and strengthen the country, for example by leveraging trust in the social sector to strengthen U.S. democracy, deepening engagement with communities and institutions, and upholding public expectations of government accountability.

“Increasing public trust of institutions and the social sector is a pressing issue for the U.S. We all benefit from strong public trust,” said Independent Sector president and CEO Daniel J. Cardinali. “Trust is the priceless currency for nonprofits, philanthropies, business charity programs, and all of us to build a healthy, equitable society. We see what happens when trust breaks. Our 2022 Independent Sector Trust in Civil Society report elevates important data and recommendations for conversations about how the social sector can engage more deeply and do better so everyone in our country thrives.” 

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Digital, other channels of giving are expanding, study finds | Philanthropy news

Emerging trends in the United Kingdom and Brazil reveal an expansion of digital and other types of channels for giving, including online giving, crowdfunding, charity rounding up, and social impact publishing, a new research series from the Indiana University Lilly Family School of Philanthropy at IUPUI finds.

The research series, Digital for Good: A Global Study on Emerging Ways of Giving, builds on the school’s Global Philanthropy Environment Index and Global Philanthropy Tracker and will be released in phases over the next five months. The first two studies examine philanthropic engagement in Brazil and the UK prior to and throughout the COVID-19 pandemic, with profiles of China, India, Kenya, Singapore, South Africa, and South Korea to follow.

Based on an analysis of three case studies in Brazil, the first profile found that prominent emerging ways of giving include charity rounding up, crowdfunding, and social impact publishing, which involves the production of inspiring, revenue-producing editorial content. Donations collected through rounding up for charity via Arredondar increased from BRL1,091 in 2013 (equivalent to $590 in 2021, adjusted for inflation) to more than BRL1.6 million in 2020 (equivalent to $330,186 in 2021, adjusted for inflation). In addition, the study found that the most successful initiatives prioritized transparency and accountability in giving.

Based on an online survey of nearly 3,000 individuals in the UK, the profile found that prominent expanded methods of giving include online giving and crowdfunding. Among donors interviewed between May and July 2021, 60 percent reported that gifts they had made in the past year had been made online, with the most common way being through a third-party app. In addition, researchers found that 63 percent of people who used social media to request donations also made requests in person.

“The results of the first two country profiles suggest an evolution in giving practices and highlight a significant expansion of digital giving practices and peer-to-peer giving,” said Amir Pasic, the Eugene R. Tempel Dean of the Indiana University Lilly Family School of Philanthropy. “While these findings are the first in a series, the documented growth in digital giving and shifting donor expectations in the UK and in Brazil reinforce existing evidence that digital practices can help democratize the practice of philanthropy. Digital innovation makes philanthropy accessible and fosters greater transparency and accountability for how gifts lead to impact.”

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