Brian R. Smith, a Certified Financial Planner and Hoover resident, is a donor who enjoys being in charge of how and when his giving is deployed. That’s why he established a Donor Advised Fund (DAF) at the Community Foundation of Greater Birmingham. “You can make grants from your DAF whenever you want to,” he said.
The Community Foundation, founded in 1959, pools financial contributions from individuals, families and businesses to support nonprofits and improve the quality of life in Blount, Jefferson, St. Clair, Shelby and Walker counties. Some of its donors set up their own DAFs, allowing them to target their contributions to specific causes they care about while drawing on the expertise and local knowledge of Community Foundation staff.
Smith likes the way the DAFs are structured. When you make a contribution to your fund, you receive an immediate tax deduction. “Then you can use the Community Foundation’s online portal to watch how the funds are doing and to submit your grant requests, and in the meantime the money is sitting there growing,” Smith said. The portal is “very efficient” and offers “a nice platform to manage your charitable contributions,” he said.
In deciding how to allocate the money in their DAFs, donors can rely on the Community Foundation staff. “As a financial advisor, I have several outlets available where I could do a DAF, but the Community Foundation is active in our community and knows what the needs are,” said Smith, who noted that the staff is “very easy to work with.” Donors interested in particular causes — such as fighting trafficking, addressing food scarcity, or supporting the arts — can ask the Community Foundation to recommend organizations that are working on those issues, Smith said. “Then they’ll arrange for site visits and interviews.”
Donors can use their DAFs to offer grants to nonprofits anywhere in the country, not just in Alabama. “The DAF gives you the flexibility to make a contribution to any non-profit,” Smith said.
Smith’s DAF is called the Smith Family Legacy Fund. “I’ve got my children as advisors on the fund, and they can make contributions to it,” he said. “It’s a good way for families to open up a fund they can use for their family giving.”
The causes Smith and his family support include ROAR (Radiation Oncology Accelerated Research) Foundation at UAB; Ady’s Big Army, which helps people with disabilities; Hope Haven Kids, which helps children in need; and Vapor Ministries in Sylacauga. “It feels good to be able to give back and use your success as a way to help the community,” Smith said.
“DAFs are easy to set up,” Smith said. “It’s just a couple of pieces of paperwork.” The minimum amount to start a DAF is only $15,000. The Community Foundation handles all of the paperwork and administration. DAFs also allow contributors toremain anonymous.
• To learn more about starting a Donor Advised Fund (DAF), contact Liz Edwards at 205-327-3808 or ledwards@cfbham.org.
• For more about the Community Foundation of Greater Birmingham, call 205-327-3800 or go to cfbham.org.
