USAA Giving Fund (Donor Advised Fund)

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ma21n2
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USAA Giving Fund (Donor Advised Fund)

Post by ma21n2 » Mon Nov 11, 2019 1:19 pm

I noticed USAA offers "USAA Giving Fund," which is a Donor Advised Fund. I see posts about Fidelity DAF (along with Vanguard's and Schwab's), but I am not finding any about USAA Giving Fund.

Does anyone have any experience with USAA Giving Fund, in terms of their customer service, competence, ease of use, etc.? My partner and I want to set up a DAF, mostly so we can donate appreciated shares that we don't want to keep (we used to use Wealthfront, so we have a lot of different ETFs and individual stocks, and we want to keep things simple). We probably won't be keeping a high balance in the account (probably less than $15K at any given time). I saw Fidelity has a minimum $100 admin fee, but USAA does not (just 0.6%/yr with no minimum). OTOH, USAA doesn't seem to have any low cost index funds.

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Stinky
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Re: USAA Giving Fund (Donor Advised Fund)

Post by Stinky » Mon Nov 11, 2019 2:51 pm

Nobody has posted yet in this thread about USAA. I’ve not seen it discussed on the Forum.

I have a Fidelity account and like it very much. There are many threads about it.

Here’s a case for you going with Fidelity. If you keep an average of $10,000 in the account, the fee at fidelity will be $40 per year higher than the fee at USAA. That’s $0.11 per day.

That $40 is 40bp on the $10k balance. If USAA doesn’t have low cost index funds, you could easily eat up the 40bp in higher fund fees than Fidelity.
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stan1
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Re: USAA Giving Fund (Donor Advised Fund)

Post by stan1 » Mon Nov 11, 2019 2:59 pm

What is the minimum grant amount at USAA? One advantage of Fidelity Charitable is that the minimum grant is $50. That makes it very easy to donate to all the causes that come up during the course of the year. As a counter example the minimum grant at Vanguard is $500. I often want to donate less than that to a charity.

megabad
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Re: USAA Giving Fund (Donor Advised Fund)

Post by megabad » Mon Nov 11, 2019 3:21 pm

ma21n2 wrote:
Mon Nov 11, 2019 1:19 pm
We probably won't be keeping a high balance in the account (probably less than $15K at any given time).
But you will be contributing more than 15k right? Otherwise, DAF might not be worth it.

USAA minimum grant is $50 like Fidelity.
Admin fees may be similar (not sure about min fee).
Investment fees are 10-20 times comparable offerings at Fidelity.

In other words, not a good offering in my book.

shess
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Re: USAA Giving Fund (Donor Advised Fund)

Post by shess » Mon Nov 11, 2019 4:11 pm

megabad wrote:
Mon Nov 11, 2019 3:21 pm
ma21n2 wrote:
Mon Nov 11, 2019 1:19 pm
We probably won't be keeping a high balance in the account (probably less than $15K at any given time).
But you will be contributing more than 15k right? Otherwise, DAF might not be worth it.
I don't know your situation, but with married-filing-jointly and SALT-limited and no mortgage interest, you may find yourself in a situation where the first $14.4k of charitable giving is not deductible. In that case, $15k gets you to where it starts being deductible, so there's an incentive to batch contributions two or more years at a time.

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ma21n2
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Re: USAA Giving Fund (Donor Advised Fund)

Post by ma21n2 » Mon Nov 11, 2019 4:11 pm

megabad wrote:
Mon Nov 11, 2019 3:21 pm
ma21n2 wrote:
Mon Nov 11, 2019 1:19 pm
We probably won't be keeping a high balance in the account (probably less than $15K at any given time).
But you will be contributing more than 15k right? Otherwise, DAF might not be worth it.
Over time yes, but this year probably only $5000 required to open an account. Seeing as I wouldn’t donate appreciated shares directly to any charity myself, isn’t DAF still a good deal?

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ma21n2
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Re: USAA Giving Fund (Donor Advised Fund)

Post by ma21n2 » Mon Nov 11, 2019 4:14 pm

shess wrote:
Mon Nov 11, 2019 4:11 pm
megabad wrote:
Mon Nov 11, 2019 3:21 pm
ma21n2 wrote:
Mon Nov 11, 2019 1:19 pm
We probably won't be keeping a high balance in the account (probably less than $15K at any given time).
But you will be contributing more than 15k right? Otherwise, DAF might not be worth it.
I don't know your situation, but with married-filing-jointly and SALT-limited and no mortgage interest, you may find yourself in a situation where the first $14.4k of charitable giving is not deductible. In that case, $15k gets you to where it starts being deductible, so there's an incentive to batch contributions two or more years at a time.
Ah. We aren’t married and we have a mortgage and above $10k state income taxes so we both itemize even without any charitable contributions.

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Stinky
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Re: USAA Giving Fund (Donor Advised Fund)

Post by Stinky » Mon Nov 11, 2019 4:21 pm

ma21n2 wrote:
Mon Nov 11, 2019 4:11 pm
Seeing as I wouldn’t donate appreciated shares directly to any charity myself, isn’t DAF still a good deal?
Yes, a DAF is a great way to donate appreciated shares.

With a DAF, there is one transfer and donation of shares - then you’re done.

If you donate the shares directly to a charity, you need to go through the transfer and donate process multiple times. Some charities are adept at receiving donated stock; some aren’t.

Also, it’s not practical to make a small donation of shares (say, $100) to a charity. But you can make a grant from your DAF for $100.
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Gill
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Re: USAA Giving Fund (Donor Advised Fund)

Post by Gill » Mon Nov 11, 2019 4:28 pm

Just took a look at USAA Giving Fund and found this:

"The USAA Giving Fund is not currently available for new accounts."

Not that I would want one anyway with the high ER on its funds.

Gill
Cost basis is redundant. One has a basis in an investment | One advises and gives advice | One should follow the principle of investing one's principal

Topic Author
ma21n2
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Re: USAA Giving Fund (Donor Advised Fund)

Post by ma21n2 » Mon Nov 11, 2019 4:30 pm

Gill wrote:
Mon Nov 11, 2019 4:28 pm
Just took a look at USAA Giving Fund and found this:

"The USAA Giving Fund is not currently available for new accounts."

Not that I would want one anyway with the high ER on its funds.

Gill
This is the best answer. Thanks for finding that. I'll go with Fidelity DAF.

shess
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Re: USAA Giving Fund (Donor Advised Fund)

Post by shess » Mon Nov 11, 2019 5:51 pm

Stinky wrote:
Mon Nov 11, 2019 4:21 pm
ma21n2 wrote:
Mon Nov 11, 2019 4:11 pm
Seeing as I wouldn’t donate appreciated shares directly to any charity myself, isn’t DAF still a good deal?
Yes, a DAF is a great way to donate appreciated shares.

With a DAF, there is one transfer and donation of shares - then you’re done.

If you donate the shares directly to a charity, you need to go through the transfer and donate process multiple times. Some charities are adept at receiving donated stock; some aren’t.

Also, it’s not practical to make a small donation of shares (say, $100) to a charity. But you can make a grant from your DAF for $100.
Also, I think it's important to keep in mind that some charities are not only not "adept at receiving donated stock", they can be actively bad at it. Checks from a DAF are just checks, but often other things like donating vehicles or stocks gets contracted out to greater or lesser degree. So they might be able to accept that asset, but if you ask how the transaction happens, you might find out that someone is skimming off a percentage as a processing charge. Certainly for things like donated vehicles or other physical assets, you're almost always looking at a third-party processor. Things like stocks might be handled in house, depending on volume, but the handling might be poor. For instance, some board member's in-law who works at a full-service brokerage might be giving them a commission discount which is still 10x what any sensible Boglehead would pay for the transaction.

That's all on top of the time commitment required. Someplace like Doctors Without Borders will have dedicated staff handling asset transfers fulltime, but your local church probably has some older congregant who handles these things on Tuesday afternoon, and a single stock transfer probably takes more time than endorsing all the checks for the week.

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