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Financial Planning > Charitable Giving > Donor Advised Funds

Schwab Charitable Grants Rose 13% in Fiscal 2021, Setting Record

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What You Need to Know

  • Schwab Charitable donors made more grants and gave a higher amount in the last fiscal year.
  • A rise in unrestricted grants allowed nonprofits to deliver critical services during a time of need.
  • Financial advisors are offering more charitable planning services to enhance their value to clients.

Schwab Charitable donors supported some 113,000 charities in fiscal year 2021, ended June 30, through 855,000 grants totaling $3.7 billion, the donor-advised fund provider reported last week.

This was a 13% increase in dollars granted to nonprofits and a 24% increase in the number of grants over previous record highs set in fiscal 2020.

“Schwab Charitable donors demonstrated extraordinary generosity during a particularly difficult 12 months,” Sam Kang, Schwab Charitable’s new president, said in a statement.

Over the last three fiscal years, donors have demonstrated a commitment to increasing their charitable impact by supporting additional charities while maintaining support for their favorite causes, the report said.

Schwab Charitable donors recommended grants to 12% more charities in fiscal year 2021 than in the previous fiscal year and nearly 30% more organizations than in fiscal year 2019.

Unrestricted grants, those that Schwab Charitable account holders did not designate for a specific purpose, increased by 48% increase from the previous fiscal year. The report noted that unrestricted grants afford nonprofits greater flexibility to deliver critical services, which has been essential during this time of extraordinary need.

Over the last three years, Schwab Charitable donors have taken advantage of technology enhancements that have encouraged giving and helped them achieve maximum philanthropic impact, according to the report.

The firm has made its digital client center simpler and more intuitive. In 2020, it rolled out a new user experience for grant recommendations and a new account overview page.

Since fiscal year 2019, the numbers of recurring grants and grants made on mobile devices have more than doubled, and in fiscal year 2021, 79% of grant volume was handled through an automated review and approval process that helps speed funds to charities.

“Constantly enhancing our capabilities and offering innovative tools and resources serves our donors and aligns with our mission to increase giving in the U.S.,” Kang said.

Financial Advisors’ Input

Financial advisors increasingly offer charitable planning as a way to enhance their value to clients by helping them incorporate philanthropy into their overall financial planning.

In 2020, 85% of independent advisors offered charitable planning to their clients, compared with 80% who offered tax planning and strategy and 68% who offered estate planning, the report said, citing Charles Schwab’s 2021 RIA Benchmarking Study.

Financial advisors are well positioned to help clients utilize charitable planning to minimize taxes and maximize charitable impact. One tax-smart strategy is donating appreciated noncash assets to charity, the report said.

In fiscal 2021, approximately 60% of contributions to Schwab Charitable were in the form of noncash assets, including publicly traded securities, restricted stock and private business interests.

Schwab Charitable said it accepts illiquid assets for contribution on a case-by-case basis, and in some cases, liquidation is facilitated by a third party. In fiscal year 2021, less than 1% of contributions were noncash assets liquidated by a third party, received by Schwab Charitable as cash and reported as noncash assets.

(Photo: Christopher Dilts/Bloomberg)


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