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Give Smarter Through Donor-Advised Funds
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BY STEVE DINNEN
DAFs, Jordan Richardson (pictured) reminds us, are the GOAT. In English, that means donor-advised funds are pretty much the greatest of all time when it comes to charitable giving. That certainly is the case at the Greater Des Moines Community Foundation, where Richardson is senior charitable giving adviser, since 45% of the more than $700 million being managed there has come through the doors as donor-advised funds.
A DAF is sort of like the charitable giving version of a mutual fund, in reverse. You send your donation to the Community Foundation, or another sponsor, and then select any number of nonprofit organizations where you want the money to go. You can direct your money to one group, two or 12, and you can have the money sent to them as often as you like. If you change your mind or see a new charity that you believe merits your benevolence, you can always add them.
Richardson and Sara Bonney, chief marketing officer at the foundation, said some donors are actively engaged in selecting gift recipients, others not as much. The donor sets the pace. Officials at the foundation can make recommendations, as well. And the donor determines the amount that is paid out and is free to change it up or down at any time.
Though donor-advised funds are not new, they grew in importance starting in 2017 with an overhaul of the income tax code. Congress then raised the standard deduction that taxpayers are allowed, and by doing so they practically wiped out Schedule A, where itemized deductions such as charitable gifts are listed. Richardson estimated that 90% of taxpayers now opt for the enhanced standard deductions.
Not to be outdone, the charitable giving industry ramped up the concept of “bunching.” For example, you normally give around $10,000 a year, every year. Once the tax code was revised, that $10,000 wasn’t high enough to reach the limitation threshold for an itemized deduction. But bunching would take three years’ worth, or a $30,000 gift at one time, and now you’ve cleared the bar to itemize deductions.
Of course, you have to dig a little deeper in your pocket for that $30,000 year. But you get the enhanced tax break in at least one year and then you can spread the fund money over three years for the same net effect. And that is the beauty of a donor-advised fund—and what led Richardson down the GOAT path.
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IOWA STOPS HUNGER
Donate Food to Your Neighbors in Need
BY STEVE DINNEN
Many charitable organizations are putting out end-of-year pitches for monetary gifts. Hope Ministries would be happy with a plump Christmas ham.
To be fair, potatoes are also welcome. And ground beef, pork loin, bacon, milk, butter, eggs—pretty much anything you can put on a meal plate.
No one in Des Moines should go hungry. And yet that appears to be the case. Hope Ministries is working to tamp it down, with meals every day and a special service on Christmas Day that President and CEO Leon Negen said may reach as many as 3,000 people.
Hope Ministries will be collecting donations on Christmas Eve from 9 a.m. to 1 p.m. at Bethel Mission, 1310 Sixth Ave. in Des Moines. There will be both walk-in and drive-through drop-off options.
Iowa Stops Hunger is a Business Publications Corp. initiative to raise awareness of hunger in Iowa and inspire action to combat it.
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How to Give Stocks as a Gift This Holiday Season
BY ANNA-LOUISE JACKSON FOR MONEY
If you’re looking for a gift that’s unique, memorable and could keep on giving, go shopping with your online broker. Stock market gifts may be tricky to wrap but they could prove to be quite valuable.
Beyond theoretical investment gains, stock gifts offer practical benefits to both givers and recipients. “We love the use of stock gifts for educational purposes,” says JR Gondeck, a partner and managing director with the Lerner Group, a financial advisory firm. “It’s a great way to teach about the concept of saving, stock ownership and discipline, even if it’s a small amount of money.”
What’s more, your loved ones may actually prefer this gift in lieu of typical presents like gift cards, clothing, electronics or toys. In 2021, 65% of Americans said they wanted investments as holiday gifts, according to a survey conducted by MagnifyMoney. READ MORE.
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How to Invest During a Recession
BY EILEEN CHANG FOR MONEY
Fears of a recession are understandably concerning for investors.
If you have a shorter timeline for your investments, like if you’re planning to retire soon, you may be especially worried about how your portfolio will fare should the economy experience a downturn.
The Federal Reserve has repeatedly increased interest rates in an attempt to lower inflation without tipping the economy into a recession. However, many experts say a recession is likely.
Here’s what to do during a recession when it comes to your investment portfolio. READ MORE.
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dsmWealth's Suggested Reading
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dsmWealth is published on the first and third Thursday of each month and updated on dsmMagazine.com.
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