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Incorporating Donor-Advised Funds (DAFs) into your giving strategy can significantly boost your nonprofit’s revenue. DAFs allow donors to contribute to a fund now and distribute grants to charities over time, offering them flexibility and immediate tax benefits. However, nonprofits must proactively inspire DAF holders to direct those funds to their causes. With the introduction of DAF Day — a new giving day designed to unlock the potential of DAFs — there’s an even greater opportunity to engage donors.
Here’s how you can inspire donors to give through their DAFs all year round, and leading up to DAF Day:
1. Ensure accurate coding of soft credits
The most important step is ensuring you have the data structure and process in place to identify donors who have given through their DAFs. Check with your donor service team to ensure they are entering the donor information provided by the fund. Fidelity notes that less than 5% of its grants are made anonymously, so take advantage of the donor information provided in the grant transmittal letters and downloaded reports.
Next, make sure they are entered as soft credits in your CRM system. This ensures that you can personalize your asks and acknowledge their gifts. Additionally, you can use donor engagement or preference surveys to get DAF donors to identify themselves.
Many of these ideas will still inspire DAF giving, but proper coding ensures that you don’t refer to or treat an active and valuable donor as lapsed when they donate through their DAF.
2. Make it easy
Ensure your website has a dedicated “Ways to Give” page with a DAF-giving widget. This feature allows donors to easily recommend a grant from their DAF directly through your site. Providing step-by-step instructions can remove any barriers to giving.
Looking for the right widget? Check out DAFwidget or DAF Direct. They are both currently available for free. DAFwidget does have more providers listed than the DAF Direct option, yet it can require more technical support to install.
3. Recognize donors
Treat known DAF donors as mid-level or even major donors. Use kid-glove treatment to ensure they feel valued and recognized by your organization. Their long-term value could be significant.
4. Offer strategic giving options
- Ask donors to use their DAFs for specific initiatives like matching gifts or challenge grants. This helps donors see how their contributions can go further and make an even greater impact.
- Invite donors to name your organization as a DAF beneficiary in the same way you would ask them to include you in their estate plan. Consider messaging such as, “If you have a giving account with Fidelity or Schwab, we’ve just made changing lives even easier.”
- Remind donors that they can use their DAF to make monthly/recurring gifts.
- Provide helpful content, articles, and calls to action, such as an invitation to speak with your on-staff stewardship reps about setting you up as a recipient of the DAF.
- Add an option to your appeal or newsletter response form saying, “Yes! I want to put my DAF to work now.”
- Use your next major donor mailing to ask for a “leadership gift” and suggest that a DAF might be an excellent way to accomplish that.
5. Personalize your outreach
Tailor your messaging to donors with DAFs by highlighting the long-term impact of their contributions. Create an emotional connection by adding a personal story or testimonial from past donors who used their DAF to support your cause.
6. Create a sense of urgency
DAF Day is a perfect opportunity to create urgency around giving through a DAF.
DAF Day, launching on October 10, 2024, encourages donors to distribute 10% of their DAF in a single day. With over $230 billion in DAF assets and 78% of DAFs making at least one grant, there’s a tremendous opportunity to channel these resources to nonprofits. By participating in DAF Day, you can inspire action and be part of a larger movement.
In the weeks leading up to DAF Day, consider:
- Homepage rotator ads linking to a “Ways to Give” page with a DAF widget.
- Traffic ads driving donors to your DAF page starting at least two weeks before the event on platforms like LinkedIn and Meta.
- Organic social media highlighting your organization’s achievements with a call to action for giving through DAFs.
- Targeted emails reminding donors about the simplicity and impact of their DAF.
DAFs are a powerful tool for both donors and nonprofits. With the addition of DAF Day, there are even more opportunities to unlock the potential of these funds and create meaningful change. By implementing targeted communications, increasing donor awareness, and making DAF giving simple, your nonprofit can further inspire donors to invest in your mission and accelerate their impact.
