June 25, 2013
I have been a donor to the California Community Foundation since sometime in the 90’s. At that time my career was in full swing and I didn’t feel that I could spend much time getting to know the organizations I wanted to support. These were also my higher tax bracket years and by establishing a donor advised fund I was able to get a deduction but defer the actual giving until the time that I could devote more attention to philanthropy. For me, this made business sense at the expense of instant gratification. It just took a disciplined process at year end to donate low cost basis stock with the benefit of avoiding gains on the stock. The IRS paid the highest tax bracket percentage of my donation every year.
Now that I am retired and in the giving phase, I don’t worry about charitable giving impacting my retirement savings. With the “prefunded” type of giving, this issue disappears and giving is much more fun. It’s like having the rich aunt leave you a “give away” fund. Now I just have the satisfaction of giving to worthy causes every year and not worrying about cutting down on my lattes.
Giving through my donor advised fund also complements my volunteer work for the organizations that I love. Currently, I’m on the Founder’s Counsel of the Williams Institute at the UCLA School of Law and on the board of Lambda Legal Defense and Education Fund. These organizations are critical to working toward full LGBT equality and are dealing with issues that were not even remotely on the table when I started donating to the California Community Foundation. It is a blessing to have saved the dollars for this time in the movement. With today’s landmark decisions from the U.S. Supreme Court on Prop 8 and DOMA, LGBT organizations will most likely be challenged by a new framework and possibly uneducated complacency among donors. I want to help with that now.
In hindsight, I think establishing my donor advised fund was one of the smartest things I have ever done. I get to match my time with my giving with the benefit of up close and personal knowledge of the staff and the work of these organizations. For me, setting aside money when I had the chance and delaying gratification created a win-win!
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