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Looking Under the Hood at Vanguard Charitable

It's arguably the best donor-advised fund affiliated with an asset-management firm for donors who plan to maintain higher account balances.

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With $10.8 billion in assets as of June 30, 2020, Vanguard Charitable Endowment Program ranks as the third-largest donor-advised fund affiliated with an asset-management firm in the United States, falling behind Fidelity Investments Charitable Gift Fund and Schwab Charitable Fund. For investors who plan to maintain larger account balances, though, it’s arguably the best option. It offers the lowest administrative costs for higher account balances as well as a rock-solid investment lineup.

As I covered in a recent article, donor-advised funds have several advantages. Donor-advised funds are public charities that qualify as section 501(c)(3) organizations. That means donors can benefit from an immediate tax deduction when they contribute cash or other assets to the fund. Although contributions are irrevocable (meaning you can't withdraw donations if you change your mind or need extra cash), the donor retains an advisory role and can recommend how to invest the assets and how much to contribute to various charities over time.

Amy C. Arnott has a position in the following securities mentioned above: VINIX, VBTIX. Find out about Morningstar’s editorial policies.