Vanguard Charitable Endowment Program

Introduction
The Vanguard Charitable Endowment Program is a donor-advised fund which utilizes Vanguard mutual funds as investment options. A Program account may have one or two advisors, who are able to recommend grants and otherwise maintain the account. Vanguard's offering has a $25,000 initial minimum contribution, a $5,000 threshold for subsequent contributions, and a $500 minimum grant amount. There is no minimum ongoing balance, but account values under $15,000 are subject to an extra $100 annual maintenance fee. In addition to the typical immediate contributions, the Program accepts revocable deferred gifts, i.e., contributions planned upon a donor's death.

Definitive Program information appears in the Policies and guidelines brochure.

Investment Options & Fees
The Program's annual fee has two components, an administrative fee plus an investment fee. The administrative fee covers the Program's operating costs. It is currently 0.57% per year for accounts under $1 million in value. There are eight available investment pools, which an advisor may employ in any combination. Again for account balances under $1 million, the associated investment fees are weighted averages of the expense ratios of the underlying Investor Class mutual funds.

Pool compositions and annual costs are as follows.


 * Gift Preservation (50% Prime Money Market, 50% Short-Term Investment-Grade): 0.23%
 * Moderate Growth (50% Balanced Index, 50% Wellington): 0.23%
 * Growth (80% Total Stock Market Index, 20% Total Bond Market Index): 0.16%
 * Total Equity (60% 500 Index, 20% Extended Market Index, 20% Total International Stock Index): 0.19%
 * Money Market (100% Prime Money Market): 0.24%
 * Total Bond (100% Total Bond Market Index): 0.19%
 * Total U.S. Stock (100% Total Stock Market Index): 0.15%
 * Total International Stock (100% Total International Stock Index): 0.27%

An additional annual maintenance fee of $100 is charged to accounts with value under $15,000.

Succession Plan Choices
Account advisors may choose among five options which take effect after they die or become incapacitated. The last selection (Endowed Grant Plan) precludes all others, but account assets may be split among the first four on a percentage basis.


 * Retain assets in the account and appoint one or two successor advisor(s).
 * Split the assets equally among multiple new accounts, appointing one or two successor advisor(s) for each.
 * Donate the assets to the Program's General Fund, a permanent endowment supporting grants to various charities chosen by the Board of Trustees.
 * Grant the assets equally to specified charities.
 * Employ the Endowed Grant Plan, which has a $250,000 minimum at the time it takes effect. Deferred gifts count toward the threshold. This option enables annual grants to at most five charities for a fixed term or in perpetuity, assuming the account balance doesn't fall below $5,000. An integer account balance percentage must be specified for each charity. The percentages must add to at least 5%.

Website
The Program maintains a secure website. An account advisor can log in and perform many common actions. The advisor can check investment pool prices/balances and easily recommend grants. Historical information is available regarding contributions, grants, and pool exchanges. The site does have some significant limitations. Pool exchanges cannot be executed, though they can be performed by telephone. The advisors' succession plan information is not available, nor are indications of any deferred gifts. Finally, updates are apparently done only during the business day. For example, Friday evening's pool prices aren't reflected until Monday morning.

Links
Vanguard Charitable Endowment Program (Forum topic)