One Simple Thing

Have a goal of getting more strategic in your charitable giving?

It's pretty understandable since the end of the year has our email inboxes, mailboxes and social media feeds full of heartwarming stories and invitations to contribute to critical initiatives both locally and globally. The stories are inspiring; the needs and organizations deserving of our attention and dollars are many. In short, it's a lot.

Giving is supposed to feel good...but it all starts to feel a little overwhelming when you know you need to get your hands around the situation, but don't really know where to start.

I know what I have the tendency to do when I feel overwhelmed—nothing.

So I’m offering a solution—one simple thing you can do to harness your generous spirit and your social and financial capital—this year and for decades to come. 

Open (or contribute to) a Donor-Advised Fund.

I know, this suggestion probably doesn’t win the warm and fuzzy award (not yet anyway…but read on). A donor-advised fund (DAF basics) is itself a charitable organization; in setting up and donating to a DAF, you can breathe more easily knowing you don’t need to have a longer-term strategic plan all figured out. Instead, you separate the charitable giving decision (one you can make today) from the non-profit partner granting decisions (which you can make throughout this year and future years).

Graphic: Donor-Advised Fund (DAF) basics (source: Kiplinger)

I have a very strategic reason for this suggestion—taking one practical first step ignites your broader journey. We all have success stories--perhaps your best friend sat you down and forced you to write out an online dating profile, and you met the love of your life in the grocery store just months later. Or after years of knowing you needed to get serious about long-term saving and investing, you finally opened up that 401(k) at work—and ironically you're now the guy at family holiday gatherings educating nieces and nephews on the basics of personal finance.

When you make that first step, you change your mindset—I’m ready to be in a relationship; I’m ready to be financially responsible. When you open a donor-advised fund, you’re saying charitable giving is important to me, and I wish to better use my money towards the change I wish to see—even if I don’t have it all figured out yet.

If you read my posts, you know the change I wish to see—in leadership, girls education, and global investing. I talk about these topics so often that most people assume these passions and commitments have been with me my entire life (sometimes I do, too!). They’re actually fairly recent. 

My journey started when I set up a donor-advised fund a decade ago. 

Prior to then, I made regular charitable contributions to organizations like Room to Read, and throughout the year would contribute to friends’ charitable causes. I wouldn’t say I had a philanthropic passion or focus. But finding myself in a higher tax bracket, it made sense to make some larger charitable contributions to a DAF, allowing them to grow tax-free knowing I could use the vehicle to recommend grants to non-profits of my choice in the future.

But the biggest impact of this decision was my change in mindset. 

I became smarter about contributing to my DAF. Instead of contributing cash, I contributed low-basis securities—stocks, ETFs, and mutual fund shares. Not only could I take a tax deduction, but in not having to pay capital gains tax on the sale, it was as if the government was partially matching my contribution. It incentivized me to give more. Contributing non-cash assets to a DAF is the number one way to maximize your charitable impact (learn more).

Visit to Room to Read Cambodia (2019)

The more I funded and made grants from my DAF, the more serious I got about putting the funds to good use. I made an effort to get to know Room to Read—attending events in San Francisco, making site visits around the world to see their work, reading their strategic plans, getting to know their management team. They’ve been critical to my learning about girls’ education globally and non-profit management, and I happily pass on their teachings to other individuals and organizations. The Education Lottery shares that story. 

Considering how to be more impactful in my giving led me to ponder how I could be more impactful in my investing. I found impact investing opportunities across asset classes, and was particularly pulled to strategies emphasizing and benefitting from women’s insights and leadership. In Doubling Down, I share how my DAF became a key tool in helping me link the gender equity focus of my investments with that of my giving strategy.

The more I did, the more ideas I had. But I still wanted to do more. I pushed myself to make a big 10 year commitment to Room to Read, and find a way to creatively intertwine it in my work. Once again, my DAF was a key tool. An Invitation shares how it came about.

My journey has now evolved to leading CGG Experiences to emerging economies; they include deep dives into education with partners like Room to Read. Trip participants describe the experience as helping them think differently—about how to best use their money, time, talent and career.

I’m known to get excited about personal finance tools—and donor-advised funds are one of my favorites. Yet I never expected that a practical financial tool would be the ignitor to helping me lead change in the three things I care most about—leadership, girls education and global investing. Towards inspiring others on their journey, I’m proud to share my story as well as other donors'. 

Do one simple thing—open (or contribute to) a Donor-Advised Fund.

Then spend time throughout the year with family and friends talking about your ideas. Get to know different non-profit organizations you find interesting--follow them on social media, volunteer or travel with them, attend an event. In short, go out and play.

And along the way, think about what strikes you--what focus areas most resonate for you and why. Identify what you really like about a certain organization or the things that give you pause. Eventually, a picture starts to emerge. I knew girls' education in emerging economies was my focus, but I wrote Your Due Diligence as a way to put down on paper what I needed to see from an organization with whom I'd choose to partner.

Opening up a DAF is the ignitor to get you to go out and play. Your values and potential partners will become clear, and your conversations and actions will lead to creative ideas. It's not the completion of a task, but the beginning of the journey.

Trust me. This is where the warm and fuzzy magic happens.

Ready to open a donor-advised fund (DAF)? Read this Forbes article on why DAFs are becoming a prime tool for Americans’ charitable giving. A great place to start is by talking to your financial advisor or financial services firm. You can open the account online in about 15 minutes.

Adapted from One Simple Thing, originally published on Connecting Growth Globally on December 2, 2019. Travel can be a great way to explore what you care most about in the company of similar curious-minded people. Learn more about Connecting Growth Globally’s CGG Experiences to Cambodia, Rwanda and Tanzania.