“A donor-advised fund allows us to enjoy involving our daughters and grandchildren in this family activity of grantmaking…without the legal and administrative requirements and costs of incorporating and managing a separate 501(c)(3).” Tony P.
“We want our fund to support WCCF’s community grant process. WCCF knows the various nonprofit organizations and current community needs and can give the money away better than we can.” Steve W.
Types of Funds
Donor-Advised Fund – donors stay involved in their philanthropy, making recommendations on how to spend the earnings each year. This is the most flexible of all our funds. Donors frequently involve other family members and generations in the family tradition of philanthropy. A donor-advised fund is like having your own family foundation without the administration and expense of incorporating a new 501(c)(3) organization.
Designated Fund – donors select a specific nonprofit organization(s) at the time the fund is set up. The designated organization(s) automatically receive the annual earnings on the fund to support general operations, a specific program or other purpose specified by the donor.
Field-of-Interest Fund – donors articulate the area of impact for their funds (e.g., children at risk, arts and culture) but leave annual grantmaking decisions to the staff of the Community Foundation.
Nonprofit (Agency) Funds – these funds are established by a nonprofit organization to provide an annual income stream for operations.
Geographic Area Funds – an individual donor or group of people living in a certain town or county can establish a fund to support a wide range of charitable organizations benefiting that community.
Scholarship Fund – donors establish the criteria and guidelines for a fund to provide financial support to students pursuing college or continuing education after high school.
Memorial Fund – donors established a fund to honor and memorialize a loved one. The fund can be any type of the above funds and is named after the loved one.
Community Grants Fund – provides discretionary funds so that our Community Foundation can respond to unmet community needs. The Western Colorado Community Foundation’s goal is to build our Community Grants Fund to $12 million by 2020; this size endowment will provide over $500,000 a year to distribute in our communities.
Permanent Funds and other options – while the majority of donor-directed funds are permanent endowments, donors have the option of establishing a fixed term fund or a spend-down (non-endowed) fund.