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Donor-Advised Funds
Dec. 17th, 2019 11:24 pmI think I found an affordable donor-advised fund provider: Fidelity Charity. do any of y'all use them? Or any donor advised fund? What do you think?
What I want is a place to send my contributions and then they send them on for me anonymously so the charities don't waste a bunch of money begging me for more.
I used to do this through a program my employer had, but then I realized their fees were super high. So I switched to JustGive.org, but they no longer exist. So I switched to Network for Good, which charges 5%.
A donor-advised fund is a different thing. I think it's designed for people who want to be able to donate their appreciated stocks to avoid the capitol gains tax. Or get the tax donation right now, and then let the money grow in investments and donate it later.
But I think this might be good for what I want to do as well. I think I can send them all my contributions for this and next year to make their $5K opening minimum--they don't have a long-term minimum. Then they charge only the higher of $100 or 0.6% for administrative fees plus 0.015% - 1.11% investment fees. (I assume these are annual fees.) For my usual $2700 annual donations, $100 would be 3.7%, so cheaper than Network for Good's 5%.
One negative is that with Network for Good, I can charge my credit card which gives me 2% cash back. But with a donor-advised fund, I probably need to transfer the money directly from my credit union (or maybe write a check or something). I think I'm okay with that. Ideally I would donate monthly. And maybe even contribute monthly unless I'm bunching like this year.
Fidelity Charity actually has a quiz on whether a donor-advised fund is right for me. The result came out no, but it is because I said I want to donate less than $5K per year--at more than 5K I get a yes. The questions didn't seem to address my concerns, so I don't think the quiz is a good indicator for me.
I found the wonderful White Coat Investor article that shows me that Vanguard also has a donor advised fund but it's too rich for my blood. And apparently Schwab has a fund similar to Fidelity's but I already have an HSA account at Fidelity, so I'd probably prefer that. And it's fun to read and makes it look like it might work for me.
Any input?
What I want is a place to send my contributions and then they send them on for me anonymously so the charities don't waste a bunch of money begging me for more.
I used to do this through a program my employer had, but then I realized their fees were super high. So I switched to JustGive.org, but they no longer exist. So I switched to Network for Good, which charges 5%.
A donor-advised fund is a different thing. I think it's designed for people who want to be able to donate their appreciated stocks to avoid the capitol gains tax. Or get the tax donation right now, and then let the money grow in investments and donate it later.
But I think this might be good for what I want to do as well. I think I can send them all my contributions for this and next year to make their $5K opening minimum--they don't have a long-term minimum. Then they charge only the higher of $100 or 0.6% for administrative fees plus 0.015% - 1.11% investment fees. (I assume these are annual fees.) For my usual $2700 annual donations, $100 would be 3.7%, so cheaper than Network for Good's 5%.
One negative is that with Network for Good, I can charge my credit card which gives me 2% cash back. But with a donor-advised fund, I probably need to transfer the money directly from my credit union (or maybe write a check or something). I think I'm okay with that. Ideally I would donate monthly. And maybe even contribute monthly unless I'm bunching like this year.
Fidelity Charity actually has a quiz on whether a donor-advised fund is right for me. The result came out no, but it is because I said I want to donate less than $5K per year--at more than 5K I get a yes. The questions didn't seem to address my concerns, so I don't think the quiz is a good indicator for me.
I found the wonderful White Coat Investor article that shows me that Vanguard also has a donor advised fund but it's too rich for my blood. And apparently Schwab has a fund similar to Fidelity's but I already have an HSA account at Fidelity, so I'd probably prefer that. And it's fun to read and makes it look like it might work for me.
Any input?