Growth in Recent Years
Donor-advised funds grew further in 2016, albeit at a slower rate of growth than in years past, setting a new record in every key metric. The rise in total charitable assets is a result of both an increase in contributions to donor-advised fund accounts and gains from investment returns. Grantmaking from donor-advised funds to qualified charities outpaced contribution growth for the third year in a row.
Grants Exceed $15 billion for the First Time
Grants from donor-advised funds to charitable organizations reached a new high at $15.75 billion. This is a 10.4 percent growth rate compared to a revised total for 2015 grants of $14.26 billion. The compound annual growth rate from 2012 to 2015 was 18.8 percent.
Contributions at All-Time High
Contributions to donor-advised funds in 2016 totaled $23.27 billion, also an all-time high. This number surpasses the revised 2015 value of $21.62 billion and shows an increase of 7.6 percent. The compound annual growth rate for contributions from 2012 to 2015 was 15.6 percent. In 2016, contributions to Community Foundations slowed and contributions to Single-Issue Charities declined, contributing to the lower total growth rate.
Charitable Assets Passed $85 Billion
Charitable assets under management in all donor-advised funds totaled $85.15 billion in 2016, an all-time high, a 9.7 percent increase from 2015. The growth can logically be attributed to 2016 investment gains at some donor-advised fund charitable sponsors, as well as to increases in the number of accounts (up by 6.9 percent) and in contributions (up by 7.6 percent).
Number of Donor-Advised Funds Saw Steady Increase
The number of individual donor-advised funds increased by 6.9 percent in 2016 to 284,965. This figure sustains the annual growth rate of 6 percent or better reported since 2012. The number of individual donor-advised funds at Single-Issue Charities increased by 2.7 percent; Community Foundations increased by 2.1 percent; and National Charities saw the largest increase, with 10.4 percent more individual donor-advised funds than previous year.
Grant Payout Remains Above 20%
Aggregate grant payout rates from donor-advised funds annually exceed 20 percent for every year on record. The payout rate for 2016 was 20.3 percent. This is very slightly below the payout rate of 20.4 percent for 2015.
Average Donor-Advised Fund Size Rose
The 2016 average size of an individual donor-advised fund based on available data is estimated to be $298,809. This is 2.6 percent higher than the revised estimate for 2015 average account size, which is revised to $291,203.