A donor-advised fund (DAF) is a powerful, flexible tool in modern giving.
With a DAF, you can make a charitable contribution, in cash or assets, receive an immediate tax deduction, and provide grants over time. Compared to setting up a private foundation, a DAF offers simplicity, flexibility, and privacy while enabling strategic giving.
And DAFs are catching on. Over the past decade, DAFs have become a popular vehicle for charitable giving. Assets in DAFs now exceed $251 billion, spread across nearly 2 million accounts.
But while DAF funding is increasing, a significant portion of those funds sits idle, waiting to create an impact.
Today’s donors want to do more. They want to give strategically and align their giving with their values. But many don’t realize their DAF can go beyond one-off grants.
Kiva’s new giving funds allow you to amplify the impact of your DAF, as they enable you to provide funds that don’t just give once — they give again and again. Read on to learn more about giving funds and other innovative uses of DAF funds.
Common criticisms of DAFs
There’s enormous untapped potential just waiting to create meaningful change.
Despite their benefits, DAFs face criticism for what’s known as “warehousing,” meaning charitable funds are accumulating faster than they’re distributed.
Many donors open a DAF to simplify giving or plan for the future, but in the process, their funds end up collecting dust.
That could be due in part to the gap between traditional financial planning and the shifting priorities of modern investors. 72% of wealth advisors don’t include philanthropy in conversations with clients, despite 87% of high-net-worth individuals saying they want help with charitable planning.
Those dollars could be put to use today, addressing urgent global challenges, such as expanding access to clean energy, empowering women entrepreneurs, or helping refugees rebuild.
But instead, there’s enormous untapped potential just waiting to create meaningful change.
Using your DAF to make an impact is easier than you think. If you have a DAF, there are simple, straightforward ways to activate it for good.
Innovative use cases for everyday donors
Choose when to give, without losing momentum
If you experience a high-income year, you can pre-fund your DAF to capture a larger tax deduction, then distribute the fund over time. Finding causes and organizations that resonate with you will help you ensure that your contributions stay active and continuously support people instead of sitting idle.
Fund your DAF with more than cash
While it’s common to fund a DAF through publicly traded assets, you may also be able to turn complex assets, including real estate, private stock, or even cryptocurrency, into charitable capital. Funding DAFs through less traditional assets may require more effort, such as appraising real estate or conducting thorough due diligence to transfer cryptocurrency. But, by donating non-cash assets directly, you can avoid capital gains taxes and maximize your contribution.
Give together, go further
Collaborative giving, also known as giving circles, is on the rise. Pooling your giving – whether by coordinating with other DAF account holders or those making donations another way – can create an even greater impact. Coordinating grants through tools like Kiva giving funds, which allow you to invite your community to join you in your impact goals, can multiply your reach.
Collaborative giving doesn’t just do more for the causes you care about; it can positively impact your well-being. 91% of people who participate in giving circles report an increased sense of belonging, and 75% say they are “better able to live their values and purpose.”
Make your portfolio work harder for good
Instead of selling appreciated securities and donating the proceeds, you can contribute them directly to your DAF. You could receive an additional tax benefit by skipping the capital gains tax (on top of the deduction you get for donations), rebalance your portfolio, and redirect gains toward causes you care most about.
Align your giving with your values
Through your DAF, you can easily direct your funds toward issues that reflect your personal mission, whether that’s gender equity, climate resilience, refugee livelihoods, or small business growth in the U.S.
In a time when things feel heavy, effectively contributing to a meaningful cause can help create positive change.
Provide stability through multi-year commitments
Utilize your DAF to make monthly gifts or multi-year pledges that provide nonprofits with predictability and breathing room. Instead of a large one-time donation, a steady financial commitment helps nonprofits better anticipate their budgets and future donations. This stability helps organizations plan ahead, grow sustainably, and deepen their impact.
Integrate giving into your legacy
A DAF can be part of your estate plan, helping you pass on charitable values to the next generation. Successors can continue to recommend grants, ensuring your impact continues for generations to come. Make sure you designate a beneficiary for your DAF account; otherwise it will likely fall to the DAF administrator to distribute any funds left after your passing.
Target impact, not just overhead
Don’t stop at general operating support. Use your DAF to seed innovation or fuel collective giving models that recycle capital into communities again and again.
Through Kiva, you can use your donation to provide underserved communities with access to loans. And loans can be incredibly impactful. 9 out of 10 borrowers report that access to their loan improved their quality of life, and over 8 out of 10 say it helped improve their confidence.
With Kiva giving funds, the impact doesn’t stop there. Each dollar you contribute becomes a revolving loan that empowers borrowers and replenishes itself through repayments, so you can continue to impact more people over time.
Why use Kiva giving funds
Most DAF grants are spent once. A Kiva giving fund reimagines that model.
Instead of one-time disbursements, your DAF dollars are lent to people building brighter futures. When they repay, your funds are automatically lent to others. That means your charitable capital keeps working, long after the first grant is made.
Kiva borrowers repay at rates above 96%, meaning your DAF funds can circulate for years — helping more people with every cycle. With every repayment, your dollars are reinvested, supporting thousands of borrowers over time. It’s sustainable, transparent, and completely automatic.
Continuous impact. Your initial donation becomes a tool that keeps giving. With every repayment, your donation recycles into new loans, multiplying your reach.
Transparency. You directly see the impact of your dollars, tracking who you’ve supported and following their progress.
Collective action. Invite friends, family, or colleagues to contribute, creating even greater change.
Cause alignment. Choose global challenges that matter most to you, from gender equity and combating climate change to fueling small businesses or assisting refugees.
Through Kiva, lending creates measurable, lasting change. Instead of a one-time donation, your DAF can become a renewable resource, a fund that continues to grow as people succeed. That’s the power of using your donor-advised fund to lend forward.
Don’t let your DAF sit idle
Your donor-advised fund doesn’t have to wait to create impact. It can become a living cycle of opportunity — one that grows, recycles, and multiplies over time.
Anyone can turn even a few hundred dollars into a changemaking fund.
