Dan Francis was shocked when his sister, a kindergarten teacher, told him how many schoolchildren arrived in her classroom already behind. The problem was lack of access to preschool in their hometown of Sidney, Ohio (pop. 20,000) during the critical early childhood years. "We knew there was something there we could do," Dan said.
Dan and his wife Jill had recently established a Fidelity Charitable Giving Account, a donor-advised fund, after selling their interest in a family business. A donor-advised fund is a dedicated account for the sole purpose of supporting charitable organizations you care about. When you contribute cash, securities or other assets to a donor-advised fund sponsoring organization like Fidelity Charitable, you are generally eligible to take an immediate tax deduction. Then you can recommend both grants to charities and investment of the remaining funds to potentially grow the charitable dollars tax-free over time. Ultimately, this can allow even more money for charitable grants.
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Dan and Jill worked with the school district in Ohio to start a public preschool, funded with grants from their Giving Account, with the idea that the school district would eventually take over the funding. That’s exactly what happened. Then, when they retired to Ann Arbor, Mich., Dan and Jill continued to use their Giving Account to support early learning in Southeastern Michigan. After researching organizations, Dan called Child Care Network (CCN)—a local nonprofit that provides preschool scholarships for lower income families suffering from homelessness or crises—and asked its director if they could meet.
When we said, ‘We’ll contribute $100,000 a year to help fund scholarships,’ I’ll never forget the look of surprise on the director’s face.
"There was a little bit of hesitation in her voice when we called," Dan said, chuckling at the memory. "I mean, here we are, these retired strangers with no kids to enroll in school, just fell in from the sky, saying, 'We want to talk to you.'
"When we said, 'We'll contribute $100,000 a year to help fund scholarships for kids who need them,' I’ll never forget the look of surprise on the director's face."
Dan and Jill were able to help an additional 79 children with their donor-advised fund through investment growth and advantages of donating stock that had appreciated for more than a year to Fidelity Charitable.
Helping children in 7 counties
Today, more than 700 children from 533 families have had the opportunity to attend preschool thanks to Dan and Jill's support. CCN supported five counties when the Francis family began granting to it; now the nonprofit organization helps families in seven counties throughout southeastern Michigan.
The Francis family credits their donor-advised fund with giving them the time to learn as much as possible about the effects of early learning before dedicating their charitable efforts to a particular organization or cause. Through the tax benefits of donating long-term appreciated securities and investment growth over the past 10 years, they've been able to provide about $170,000 more in support to CCN than they could have otherwise. That's helped them assist 79 more children.
"We didn't want to do one big gift and walk away," Dan said. "We wanted to find the area where our money could have the greatest impact over time. There's just no question that our Giving Account has allowed us to do more good than we could have without it." That plan is good for the organization they support, too, with a new grant recommendation each quarter providing Child Care Network with funds to help area families.
Dan said he knows that grants to early learning "is money well spent," citing research that shows the profound effects that preschool has on children from disadvantaged families in particular, raising long-term academic performance and earning power while lowering truancy and crime rates. "Providing early education for kids is one of our country’s major social problems," he said.
Dan and Jill were able to help 79 more kids attend preschool because they use a donor-advised fund than they could have without one. Could a donor-advised fund help you to give more?
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