The Impact of DAFs on Humanitarian Aid

This past year brought seismic changes to the landscape of humanitarian aid. Global needs and extreme poverty are escalating and increasingly concentrated in countries where we see an alarming convergence of conflict and the consequences of climate change. At the very moment these needs are rising, funding from federal agencies has been slashed and programs shuttered.

By some estimates, U.S. cuts to global health spending could cost 25 million lives in the next 15 years. Cuts to funding for healthcare delivery and vaccination campaigns in fragile countries risk undermining global health security and exposing the global population to graver risks.

Amidst all of these challenges in the foreign aid sector, a specific set of donors have stepped up in a significant way. Gifts from donor-advised funds (DAFs) have seen a notable increase, with the International Rescue Committee (IRC) reporting a 39% increase in DAF revenue year to date when compared to last year.

This increase in giving via DAFs will play a crucial role in supporting the IRC’s and other humanitarian aid organizations’ work within the United States and abroad. Six features set DAFs apart from other philanthropic vehicles in the humanitarian aid space:

1. Speed in crisis. Humanitarian organizations are crisis organizations, and DAF gifts are the fastest way for a donor to put dollars into action during a crisis. Lifesaving assistance, such as emergency medical teams, clean water and sanitation services, and cash aid can have immediate impacts on communities in need. Now, with advancements in electronic transfers, a donor can recommend grants and have those funds activated quickly, ensuring aid reaches those in critical need quickly.

2. Global reach. DAFs allow for cross-border philanthropy, giving donors the flexibility to contribute to global causes while ensuring their support is directed as intended, all while allowing them to retain home-country tax benefits.

3. Growing philanthropic reserves. DAFs act as charitable savings accounts, letting donors make gifts at a cadence that works for their financial planning. DAFs allow donors to grow their invested assets and deploy them immediately when crises strike. 

4. Guidance and education. There are many ways for donors to have an impact in the humanitarian aid space, but donors may be unsure of how to direct their giving. Some DAFs provide donors with resources such as advisors or lists of recommended charities. Others may direct donors to resources such as Charity Navigator or Candid, helping them give with confidence.

5. Tax benefits. Tax laws can have an impact on philanthropy in any given year. For example, DAFs offer donors the opportunity to bundle their gifts for maximum tax advantage, while making grants over many years or when crises occur.

6. Ease of estate planning. DAF accounts easily facilitate philanthropy both in the present and in the future. Donors can choose to name their family members, or nonprofits of their choosing as the beneficiary of the account, allowing their philanthropy to live on for generations.

Despite the increasing scale and intensity of global crises, unwavering support from donors through vehicles such as DAFs help meet the moment head-on. From reaching displaced families searching for safety, to treating children with acute malnutrition, DAF gifts help humanitarian organizations provide critical lifesaving programs to people trapped in cycles of crisis. 

With humanitarian crises escalating and traditional funding sources under strain, DAFs are proving indispensable. Their nearly 24% payout rate underscores why they remain the fastest‑growing vehicle in philanthropy—and why now is the time for advisors to help clients leverage them for maximum impact.

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