Donor-Advised Funds
Dec. 17th, 2019 11:24 pm![[personal profile]](https://www.dreamwidth.org/img/silk/identity/user.png){kind=small}
livingdebI 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?
Fidelity Charity Giving Account
on 2019-12-19 08:51 pm (UTC)It is true that by using a credit card you get money back, but you can accomplish the same thing by just giving less--when you use the credit card, the charity has to pay a 3% overhead, typically.
no subject
on 2019-12-20 03:50 am (UTC)no subject
on 2019-12-20 04:12 am (UTC)There are other places I could have gone, but literally every single personal finance blogger I could find was using Vanguard, Fidelity, or Schwab. Or a combination (holy yikes, those people are rich!). I could not see that Schwab was better for me than Fidelity in any way, based on some comparison charts I found, so I went with Fidelity to pay them back for having free HSAs and to stay with a company I'm already using.
I did research other strategies, and in case these are of interest to you, here are some other ideas on how to contribute anonymously:
* Google One Today - an app of some kind (okay, boomer!)
* Charity Navigator - Research places that let you opt out of having your information sold. But it looks like they'll still send you their own info.
* Donate by money order - This may be the best low-cost idea: just send mail orders to your charities and leave your name off them and leave your return address off your envelope. That's one stamp plus the fee for the money orders, which I read is generally cheaper at retail establishments than at banks or the post office. I am not up for dealing with that this year (you never really know if you got the right address, and they actually got it). I assume the money order receipt or copy or whatever you get is good enough for tax purposes.