November 2, 2000 | Read Time: 1 minute
By STEPHEN G. GREENE
Donor-advised funds — sometimes called “the poor man’s foundation” — have been growing quickly and have a secure future, according to Bloomberg Personal Finance (November).
Such funds — which give donors flexibility in timing when they make a donation and when a charity receives it — now account for more than half of new gifts made to community foundations, which have offered them as options for more than 85 years.
In the past several years, however, funds established by major mutual-fund companies have become increasingly popular.
The Fidelity Charitable Gift Fund, created in 1992, is the largest, but the Schwab Fund for Charitable Giving and the Vanguard Charitable Endowment Program are also growing quickly.
Community foundations contend that they are much closer to nonprofit organizations in their communities, and can help donors make more informed decisions about worthy beneficiaries of their gifts.
The companies’ gift funds emphasize making giving as simple as possible. The process increasingly is conducted online. At Fidelity, for example, 30 percent of contributions and grant recommendations arrive via the company’s Web site.
While the companies’ gift funds hold a technological lead, according to the article, more than a dozen community foundations either have or plan soon to feature such interactivity on their Web sites.
The article is available at http://www.bloomberg.com.
