Navigating 2025 Advancement Trends: DAFs Are Having a Moment

If you’ve been keeping an eye on fundraising trends lately, you know there’s one giving vehicle that’s making waves: Donor-Advised Funds (DAFs).

Once viewed as a niche tool for high-net-worth philanthropists, DAFs have become the fastest-growing vehicle in philanthropy. They’re not just reshaping major giving—they’re changing the donor pipeline altogether. In the third installment of our series on 2025 Advancement trends, we’ll unpack why DAFs are having a moment, what the data tells us, and how advancement teams can take advantage of this momentum.

Unpacking the Trend: The Rise of DAFs

According to the CSS 2024 Philanthropic Landscape Report, there are now an estimated 2 million DAFs in the U.S., a massive leap from just a decade ago. In 2023 alone, $55 billion was given through DAFs, with an average annual growth rate of nearly 20 percent over the past five years, according to Chariot’s 2025 DAF Fundraising Report. The impact on nonprofits is undeniable—median revenue from DAFs has increased 30 percent since 2023.

Perhaps the most telling stat from Chariot’s report: 69 percent of DAF gifts are less than $1,000. That challenges the misconception that DAFs are only for “uber wealthy” donors making six-figure contributions. Instead, DAFs are becoming a preferred giving channel across donor levels—from leadership annual giving to major gifts. What’s more, retention rates are stronger among DAF donors. Once a donor starts giving through a DAF, retention jumps from 46 percent to 59 percent. That’s a meaningful lift that translates directly into long-term impact for advancement teams.

So why should institutions pay close attention to DAFs right now?

First, DAFs are pipeline builders. They’re fueling both annual leadership gifts and future major gift conversations. At Schwab Charitable, the second largest DAF in the world, more than 24 percent of 2025 grants were directed to education. That’s more than $2.2 billion in grants—it’s clear that educational institutions are top of mind for DAF donors.

Second, unrestricted support is growing. Schwab Charitable’s 2025 Report unveiled that 72 percent of grants are now unrestricted—a 20 percent increase from the previous year. That’s a big win for institutions working to balance donor intent with operational flexibility.

Finally, DAF donors are more engaged. On GiveCampus, the average DAFpay gift is six times larger than a standard gift, with a median of $500 and an average of $2,000. Even more compelling: 20 percent of donors increase their gift after logging into their DAF account and seeing their balance.

The question isn’t whether DAFs are growing—it’s undeniable. The real question is: how can your institution be ready to capture and sustain that growth? 

Navigating the Trend: How to Harness DAF Momentum

Positioning your school to benefit from this surge requires more than passively accepting DAF gifts. It means creating visibility, removing friction, and building relationships that transform one-time distributions into long-term loyalty. The schools that win in this space will be the ones who treat DAFs not as a “bonus” channel, but as a core part of their fundraising strategy.

With that in mind, below are three proven strategies to help your team harness the momentum behind DAFs and turn it into real results.

1. Make It Easy to Give with DAFs

One of the biggest barriers to DAF giving is simple: donors don’t always realize how—or even if—they can use their DAF to support your institution. That’s where DAFpay comes in.

DAFpay, created by our partner Chariot, is a digital payment option designed to make giving through DAFs feel just as accessible and familiar as paying with a credit card or PayPal. When donors land on your giving form, they see a DAFpay button displayed alongside those other common payment methods. From there, completing a DAF gift is just a short, three-click process—no detours, no separate paperwork, and no frustrating delays in processing.

By enabling DAFpay across every campaign and form, you remove the friction that often causes donors to abandon or delay a gift. It also surfaces DAF giving to donors who may not have considered it—or who might not even realize they can use their DAF for your cause. This visibility is key, because many DAF holders don’t advertise that they have one. When the option is right there in front of them, they’re far more likely to act in the moment.

Blog: How to Streamline DAF Giving for Every Member of Your Advancement Team

2. Increase DAF Awareness

Awareness is half the battle with donor-advised funds. While DAFs continue to grow rapidly, many donors don’t automatically think of your institution when they log in to make a distribution—and some may not even realize they can direct DAF gifts to you at all. That’s why visibility and education are critical. Start by weaving DAF messaging into the moments when donors are most likely to act—your Giving Day promotions, year-end campaigns, and leadership giving appeals. Elevating DAF awareness doesn’t just capture more dollars—it shapes how donors see you. By proactively naming DAF giving in your communications, you position your institution as the natural, easy choice for distributions.

We’ve already seen how this plays out in practice. Bates College, for example, enabled DAFpay during their annual Friends of Bates Athletics Challenge and saw 67 percent of \ DAF donors make their first-ever DAF gifts to Bates—gifts that averaged nearly five times larger than non-DAF gifts.

The takeaway: don’t let DAFs remain a hidden giving option. The more you normalize and highlight this channel, the more likely donors are to use it—and to think of you first when they do.

Learn more about how Bates College leveraged DAFpay to unlock first-time donors

3. Build a Process for New DAF Donors

Capturing a DAF gift is only the beginning—the real opportunity lies in what happens next. Every DAF grant should be treated as a door opener to a long-term relationship.

The first step is having a clear process in place. Ask yourself: when a new DAF gift comes in, what happens? Is it logged, tracked, and flagged in your database? Do you know if it’s the donor’s first gift through a DAF, or their first gift to your institution altogether? Without a structured plan, valuable signals can slip through the cracks.

Here are a few practical steps to consider:

• Identify and Research: Create a workflow that flags new DAF donors for additional review. What do you know about their giving history? How does their DAF gift compare to prior support? Many times, a DAF gift represents a donor testing the waters at a higher level of giving. Don’t let that insight go unnoticed.
• Personalize Stewardship: Treat every new DAF donor like a leadership prospect. This doesn’t mean rolling out the red carpet for every $500 gift, but it does mean ensuring there’s a thoughtful acknowledgment process. A personal thank-you from a gift officer, a student, or even a volunteer can be the difference between a one-time DAF distribution and a recurring relationship.
• Cultivate for the Pipeline: Remember, DAFs aren’t just about today’s dollars—they’re about tomorrow’s major gifts. Donors who give through DAFs are more likely to become repeat supporters. By building a stewardship path for these donors, you’re not only capturing current revenue but also fueling your leadership and major gift pipeline.

Wrapping Up Trend: DAFs Are Having a Moment

DAFs are no longer a side note in fundraising—they’re central to the conversation. With explosive growth, strong donor retention, and increasing accessibility, DAFs represent a huge opportunity for advancement teams. The institutions that will benefit most are the ones who make it easy for donors to give through DAFs, shine a spotlight on the option, and put clear processes in place to steward new DAF donors with care.

This isn’t just about capturing larger gifts—it’s about building a stronger pipeline. Every first-time DAF gift is an opening to deepen engagement, cultivate leadership donors, and lay the groundwork for major gifts down the road. By treating DAFs as a core giving channel, not a bonus, you ensure your institution is top of mind when donors decide where to direct their philanthropic dollars.

In the next (and final) installment of this series, I’ll explore Trend #4: AI in Advancement—Tech Assisted, Human Led and share how teams are leveraging technology to save time, personalize outreach, and focus on what matters most: building authentic donor relationships.