Vanguard Charitable Endowment Program

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The Vanguard Charitable Endowment Program [1] 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 will be charged an annual $250 maintenance fee in March.[2] In addition to the typical immediate contributions, the Program accepts revocable deferred gifts, i.e., contributions planned upon a donor's death.

Investment options and fees

The Program's annual fee has two components, an administrative fee plus an investment fee. The tiered administrative fee covers the Program's operating costs. It is currently 0.60% per year for the first $500,000 in account value. There are 13 available investment pools, which an advisor may employ in any combination.

Investment Fees

Pool compositions and annual costs are as follows:

Multi Fund Pools

  • Gift Preservation (50% Vanguard Prime Money Market Fund, 50% Vanguard Short-Term Investment-Grade): 0.10%
  • Conservative Growth (30% Vanguard Total Stock Market Index Fund, 10% Vanguard Total International Stock Index Fund, 60% Vanguard Total Bond Market Index Fund): 0.09%
  • Moderate Growth (45% Vanguard Balanced Index Fund, 10% Vanguard Total International Stock Index Fund, 45% Vanguard Wellington): 0.18%
  • Growth (55% Vanguard Total Stock Market Index Fund, 20% Vanguard Total Bond Market Index Fund, 25% Vanguard Total International Stock Index Fund): 0.09%
  • Total Equity (55% Vanguard 500 Index Fund, 15% Vanguard Extended Market Index Fund, 30% Vanguard Total International Stock Index Fund): 0.10%

Single Fund Pools

  • Money Market (100% Vanguard Prime Money Market Fund): 0.09%
  • Short-Term Bond (100% Vanguard Short-Term Investment-Grade Fund): 0.11%
  • Total Bond (100% Vanguard Total Bond Market Index Fund): 0.10%
  • Total U.S. Stock (100% Vanguard Total Stock Market Index Fund): 0.06%
  • Total International Stock (100% Vanguard Total International Stock Index Fund): 0.16%
  • European Stock (100% Vanguard European Stock Index Fund): 0.12%
  • Pacific Stock (100% Vanguard Pacific Stock Index Fund): 0.12%
  • Emerging Markets Stock (100% Vanguard Emerging Markets Stock Index Fund): 0.18%

Maintenance Fees

  • Account values under $15,000 will be charged an annual $250 maintenance fee in March.[2]

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.
  • Make lump sum grants to specified charities.
  • Donate the assets to the Vanguard Charitable's General Fund, a permanent endowment supporting grants to various charities chosen by the Board of Trustees.
  • Employ the Endowed Grant Plan, which enables annual grants to one or more charities for a fixed term or in perpetuity, assuming the account balance doesn't fall below $5,000. An account balance percentage must be specified for each named charity, with the percentages adding to at least 5%.

Website

Vanguard Charitable maintains a secure website. An account advisor can log in and perform most common actions, e.g., check investment pool prices/balances, recommend one-time or recurring grants, and recommend pool exchanges. There's even the ability to make some contributions of Vanguard mutual fund shares entirely online. Detailed account history is available regarding balances, contributions, grants, and exchanges.

References

External links