Families using philanthropy as teaching opportunity

Charitable giving is becoming a family affair and an opportunity help children learn about philanthropy, particularly in families headed by donors under age 50, a new report says.

Donors with donor advised funds also are increasing the size of their grants, make grants more often, and spend most of the contributions to their funds within 10 years, says the 2014 Fidelity Charitable Giving Report.

The report, based on a survey of over 1,100 Fidelity Charitable donors and an analysis of the granting behavior of over 104,000 donors connected to nearly 64,000 donor advised funds, also says donors frequently recommend grants in advance or arrange for their distribution on a recurring basis.

Ninety-four percent of donors surveyed agreed strongly or somewhat that they are teaching or have taught their children to give, and 65 percent discussed their charitable giving with family more than twice in the past year, including 17 percent who discussed the topic with family more than five times a year.

Seventy-eight percent said the causes they support reflect input from family members.

Donors under age 50 were one-and-a-half times as likely as donors over 70 to strongly agree they are teaching or have taught their children to give.

Seventy-eight percent of donors under 50 talk about philanthropic strategies with family members at least twice a year, and 86 percent agree their family influences their charitable choices.

The analysis of donor advised funds at Fidelity Charitable found the average number of grants per fund grew to eight a year in 2013 from seven in 2012, with the average grant totaling $4,017, up 6 percent from the 2012.

Most income contributions to giving accounts are fully spent as grants within 10 years with 91 percent of contributions made from 1996 through 2000 granted to charities by the end of 2010.

Just over one in five grants, or a total of 110,000 grants, were recommended on a pre-scheduled basis.

Grants designated to to be used “where needed most” accounted for 41 percent of gnats overall.

An analysis of grants by the age of the donor found older donors recommend grants  across a wider range of charitable sectors than younger donors.

Donors under age 50  were most likely to recommend grants to the education, human services and religion sectors.

Donors older than 50 supported those sectors at similar or slightly greater frequencies, but recommended grants more frequently to charities in other sectors as well.

Todd Cohen

Donor advised funds post growth

Fidelity Charitable and Schwab Charitable, two big national donor advised fund programs, reported growth in contributions from donors, and in grants from funds to charities.

Donor advised funds let investors contribute cash or appreciated assets or both to a charitable account, and then use those accounts to support charities.

At Schwab Charitable, assets under management grew 55 percent to $4.8 billion in the fiscal year ended June 30, 2013, compared to the previous year, while grants to charities grew 12 percent to $600 million.

Schwab Charitable also doubled its new accounts.

Since its inception, Schwab Charitable has received over $8 billion in contributions and facilitated over $3.6 billion in grants to charities on behalf of its donors.

At Fidelity Charitable, donors recommended over 214,000 grants totaling $919 million in the first six months of 2013, up 33 percent from the same period a year earlier, while contributions from donors’ charitable accounts grew 7 percent to $879 million.

New charitable accounts in the first six months totaled 1,640, up 43 percent from the first half of 2012.

Grants of $1 million or more to nonprofits grew 50 percent, helping to boost the average grant size to $4,285, up 10 percent from the first half of 2012.

Forty-three percent of contributions from donors to their accounts came in the form of securities, with the remainder in the form of cash.

Non-publicly traded assets, such as private stock, accounted for five percent of contributions.

Since it was established in 1991, Fidelity Charitable has worked with donors to support over 160,000 nonprofits with over $14 billion in grants.

Fidelity Charitable attributed to referrals from professional advisers over 70 percent of contributions made in the first half of the year, and over 60 percent of new charitable accounts established.

Schwab Charitable cited the 2013 RIA Benchmarking Study from Charles Schwab, released last week, that found 54 percent of all firms with assets under management of $25 million or more currently offer charitable planning services.

Of those firms, 85 percent of those firms indicated at least some of their clients are using those services, and 34 percent are considering considering offering charitable planning in the future.

Among firms with assets under management totaling $50 million to $100 million, 50 percent are considering offering charitable planning in the next year to 18 months.

— Todd Cohen

Fidelity Charitable moving headquarters to North Carolina

By Todd Cohen

RALEIGH, N.C. — Fidelity Charitable, a national donor-advised fund program, is moving its headquarters to North Carolina from Boston.

Fidelity Charitable, which will make the move in about a year, is a division of Fidelity Investments, which already employs over 3,200 people in North Carolina, mainly in the Triangle at its campus in Durham and a data center in Cary, and also at investor centers in Charlotte, Durham, Greensboro and Raleigh.

A Fidelity Charitable spokesman would not provide details about how many people it employs in Boston or how many employees would be involved in the move.

“We don’t typically release numbers for individual business units and we don’t speculate on future moves,” Jenny Engle, the spokesman, said in an email message.

“We’re taking a measured approach and are currently working out many of the operational and organizational details involved in this transition and intend to execute it in a way that minimizes disruption to donors and continues to ensure the highest level of service,” she said.

Engle said the move “will position us to meet the needs of our donors over the long-term with room to grow, access to a talented pool of employees and the ability to establish an independent physical site for our organization.”

Engle did not respond to questions about any plans at Fidelity Charitable to attract new donors in North Carolina, and would not provide details about the company’s corporate giving.

Fidelity Investments “practices quiet philanthropy,” she said by phone. “When we do talk about community commitment, we tend to focus more on what our employees are doing in the way of volunteerism.”

Formed in 1991, Fidelity Charitable is an independent public charity that has worked with donors to support over 160,000 nonprofits with over $14 billion in grants.

With $9.3 billion in assets as of Dec. 31, 2012, donor contributions to Fidelity Charity totaled over $3.6 billion last year, and grants made to charities totaled $1.6 billion.

Grants in the fiscal year ended June 30, 2012, included $21.2 million to North Carolina charities and nearly $15.5 million recommended by North Carolina donors.

Fidelty, Schwab post records

Fidelity Charitable and Schwab Charitable, two national donor-advised fund programs have reported record-high financial results.

Fidelity Charitable, an independent charity with a donor-advised fund program, says nearly 180,000 outgoing grants totaling $691 million to nonprofits in the first half of the fiscal year represented a record and an increase of 14 percent from the same period last year.

Those grants brought the total amount recommended by donors and granted by Fidelity Charitable to over $13 billion since it was established as a public charity in 1991.

Contributions to Fidelity Charitable grew to $824 million, an all-time high, from $512 million in the first half of 2011.

In the fiscal year ended June 30, 2012, donors recommended grants totaling nearly $1.4 billion to nonprofits, up 11 percent from the previous fiscal year, while incoming contributions grew 10 percent to $3.2 billion.

Schwab Charitable, a national donor-advised fund organization, reported record charitable assets under management and record annual grants in the fiscal year ended June 30, 2012.

Assets under management grew to $3.16 billion, up 3.6 percent from a year earlier, while grants to charities grew to $524 million, up nearly 4 percent.

Assets under management exceeded $3 billion for the first time since Schwab Charitable was established in 1999.