Vol. 01 · Issue 04

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Wealth Preservation DeskIssue #15 · Jun 20

Donor-advised funds vs. direct giving: the honest tradeoffs.

The DAF is a useful tool. It is not a moral upgrade. Here's when it earns its keep, and when it just delays generosity.

Tom Whitfield

The Smart Money

1 min readEvergreen

A donor-advised fund earns its keep in exactly two scenarios: a high-income year you want to smooth deductions across, or a low-basis asset you want to donate without triggering capital gains. Outside those, direct giving is often simpler and gets the money to the charity faster.

The failure mode is the DAF that sits at 90% invested for a decade while the donor 'decides.' That's not philanthropy. That's parking.

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