As the pandemic besieged the U.S. in 2020, account holders at Fidelity Charitable and Schwab Charitable, two major sponsors of donor-advised funds, significantly increased their giving over the previous year to support relief efforts by nonprofit organizations.
Fidelity Charitable reported that donors recommended 2 million grants totaling $9.1 billion to 170,000 charities; that was 31% more grants and a 24% increase in dollars over 2019.
In addition, the more than 250,000 Fidelity Charitable account holders not only sustained nonprofits they had supported previously, but also made grant recommendations to organizations for the first time in 2020. Grants went to some 170,000 unique charities, up 10% from 2019.
The tremendous acceleration in giving last year showed the power of donor-advised funds to offer relief when it’s needed most and help sustain the nonprofit sector in the face of unprecedented adversity,” Fidelity Charitable’s president Pamela Norley said in a statement. “Notably, three-in-four grants were made to organizations donors had previously supported.”
Grants to the human services sector accounted for about a quarter of giving in 2020. Grants to free food programs increased twelvefold.
Three charities that provide food assistance — Feeding America, Meals on Wheels and World Central Kitchen — were among the 20 charities most supported by Fidelity Charitable donors for the first time last year.
Nearly two-thirds of all recommended grants were designated “where it’s needed most.” Fidelity Charitable noted that this was a great benefit to charities that value flexibility as they struggled with last year’s demands.
In 2020, donors also increased both the pace and the size of their recommended grants. The average account holders recommended 12.8 grants, compared with 10.8 in 2019. The average grant amounted to $4,614, about $250 more than the previous year.
More than two-thirds of Fidelity Charitable contributions in 2020 were noncash assets, including publicly traded securities and non-publicly traded assets. This enabled donors to take advantage of strong market gains, minimize capital gains taxes and give more to charity, the report said.
For instance, donors contributed $28 million in cryptocurrency into their charitable accounts, way up from $13 million in 2019.
Impact investing grew in both investments and philanthropy last year, as donors continued to align their investment recommendations with their values.