DONOR FREQUENTLY ASKED QUESTIONS

Q. How does giving through the Vermont Community Foundation work?
A. You set up a fund at the Foundation with an irrevocable gift (minimum value of $10,000). You can make your gift now or through your estate plan. The Foundation invests your gift along with those of other donors, and each year investment returns are added to the principal and a percentage of the fund is set aside for grants. Many donors establish a fund during their lifetime, then add to the fund upon their death.

Q. Does the Foundation charge fees?
A. Each fund pays a “supporting fee” (a percentage of the fund’s assets) that supports the VCF’s mission and allows the Foundation to offer services like grantmaking and gift administration, investment and asset management, and donor education. The supporting fee varies by the type and size of the fund. Additionally, invested funds are assessed an investment management fee.

Q. How does the Vermont Community Foundation differ from commercial charitable gift funds?
A. Many financial institutions offer “charitable gift funds,” which are similar in some respects to the funds offered by the Foundation: you give money, you get a tax advantage, and the institution handles all of the paperwork associated with your fund’s transactions. Indeed, if your primary concern is ease in transacting grants, then a charitable gift fund may be right for you. The Foundation can offer much more, though. We are a true resource for Vermont-focused philanthropists. We help you understand the most pressing issues facing Vermont, and point you to where your grants can make a real difference. We find the organizations that are doing outstanding and innovative work. We spearhead statewide initiatives and invite you into the fold. We connect you with other Vermont focused philanthropists and help you signal others to build the state’s charitable capital. In short, we go far beyond transacting grants and managing your charitable investment. Our “business” is helping Vermont-focused philanthropists like you have lasting impact.

Q. What is the Foundation’s investment policy?
A. The Foundation invests its assets for the support of current and future generations. This is accomplished using a diversified asset allocation strategy oriented towards higher return assets, and executed using highly capable investment managers.

Q. Is there a giving option that helps the Foundation address Vermont’s needs as they arise?
A. Discretionary field of interest and discretionary unrestricted funds leave the annual grantmaking decisions to the VCF to respond to pressing community needs. It’s a wonderful way to ensure that your gift remains relevant over time.

Q. Can I specify how my gift is to be used?
A. Yes. An advised fund allows you to review your giving and recommend grants to any IRS qualified charity you wish to help. A designated fund is established to help the organization(s) you specify when you create the fund. Discretionary funds (unrestricted and field of Interest) leave the grantmaking decisions to the Foundation.

Q. Can my children continue to advise the funds?
A. Yes. An advised fund can help nurture a lasting philanthropic spirit in your family. You may name one generation of successors to advise grants from the fund you establish.

Q. How will I know my wishes will be followed?
A. At the time a fund is established, and throughout the life of the fund we make sure we understand what your wishes are, and ensure that your charitable interests are followed. We take stewardship of funds very seriously.

Q. Do I have to give cash?
A. No. Many donors give appreciated stock or real estate to maximize their tax benefits. You can also earmark IRAs or pensions to the VCF, or even purchase life insurance that names the VCF as the beneficiary. Almost any asset of appreciable value can be transferred to the Foundation.

Q. Can I give out-of-state as well as in Vermont?
A. Yes, as long as the recipient is a qualified charity.

Q. I’d like to set up a fund. But I can’t afford a large fund now. Can small gifts make a difference?
A. Absolutely. Many of the Foundation’s funds started modestly. And if you choose to establish a discretionary fund, its grantmaking dollars are combined with others to have broad impact through our grantmaking programs. You can also make a gift to the VCF’s Community Fund, which pools contributions to be awarded as grants each year to hundreds of organizations across the state.

Q. I’m interested in establishing a memorial fund. Can I name the fund?
A. Of course. You choose the name for any fund you establish. Or you can give anonymously, if you prefer.

Do you have other questions? Please contact one of our philanthropic advisors to learn more.