Donors can see the impact of their philanthropy in their lifetime
“The gift that keeps on giving,” is how Craig Hikida, Vancouver Foundation’s vice president, Donor Services, describes the increasingly popular choice by philanthropists to establish a Donor Advised Fund (DAF) – a charitable endowment fund that enables donors to see the impact of their philanthropy during their lifetime.
Vancouver Foundation is one of the Canada’s largest community foundations and grants about $80-million to nearly 6,000 charities and nonprofits in British Columbia each year. Since it was founded in 1943, the foundation has granted more than $1.5-billion to a range of charities and organizations that tackle community concerns ranging from access to childcare, environmental issues, arts and culture, animal welfare and addressing homelessness.
Mr. Hikida says traditionally the impact of philanthropy takes place after people’s lifetime when gifts from estate plans and wills are distributed.
“By making a testamentary gift, people never get to see and appreciate the outcome of their gift,” he says, but people who gift through a donor advised fund can see the difference their gift makes during their lifetime.
“Donors decide on the amount of money to place in the DAF. The money is held, invested and the income that is generated is granted out to the community – to the charities or causes the donor wants to support – and they get to witness the impact of their gift,” he explains.
“Most donor advised funds are held in perpetuity, so even after the donor’s lifetime, that money still does good work in the community,” says Mr. Hikida, adding the donor leaves well-documented instructions on the types of organizations and issues that they want to support on an ongoing basis.
“It is one gift that does continue to keep giving.”
Mr. Hikida acknowledges it is difficult to anticipate the future needs of communities.
“We encourage donors, while they have donor advised funds, to support their favourite charities during their lifetime. After their lifetime, we hope they consider not the charity, but the cause that is important to them,” he says. “We’re talking about perpetuity, and we’re not sure which organizations may still exist over time, but the cause will still be there, and the gift you make will continue to be relevant.”
However, DAFs are just one of the ways to support community through Vancouver Foundation. Some donors opt to leave all the decision-making to the foundation while others want to see the gift spent over a specified number of years. In other cases, donors choose to endow a percentage of the gift and designate the balance to meet immediate needs.
Donors can gift cash or assets such as appreciated securities and life insurance to Vancouver Foundation. Donations to charity also offer the opportunities for tax savings.
Mr. Hikida notes that because Vancouver Foundation receives its funds from community members, the community decides how to support the work of organizations in the province.
“We use a community engaged process where an organization can apply to us for a grant and we will ask community members, either volunteers or community advisers, to help us adjudicate those grants. The community decides what’s important to community at that time,” he says.
He cites accessible childcare as an example of that process – and how philanthropy changes lives and outcomes. About 14 years ago, the foundation made a grant to Generation Squeeze, a nonprofit organization campaigning for $10-a-day childcare. While he credits the leadership and work done by Generation Squeeze, he recalls at that time the foundation invested in an issue that was impacting the health of communities. The concept gained momentum, and in the 2021 and 2022 budgets, the federal government made substantial investments to make childcare more affordable.
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