A Donor Advised Fund is a charitable giving account created by an individual, family or organization that offers an immediate tax benefit and allows you to make grants over time.Read More
Education, conservation, humanitarian aid and music are the philanthropic passions of physicians Robert and Veronica (Ronnie) Petersen. They have been able to contribute generously to these causes over the decades because of an inheritance, savvy investments and creative giving strategies.
“I didn’t give any significant money until my parents died, because I didn’t have it,” Ronnie explains. “My husband and I were both academic physicians. If I hadn’t inherited a substantial amount of money from my mother I couldn’t do this.”
While working as a pediatrician at Harvard Vanguard in Cambridge for 27 years, Ronnie educated herself on investing and other financial matters, becoming aware as she did so that there were tools she and her husband could use to maximize the impact of their philanthropy. One of them is the Donor Advised Fund (DAF) the couple opened at the Boston Foundation in 2001.
“I like to decide where my money goes, and under our tax system we get a benefit for giving it,” she explains. She and her husband have given real estate to Haverford College (she grew up on campus as a faculty child), the Massachusetts Audubon Society, and the Nature Conservancy through charitable remainder unitrusts, which pay them an annuity for a fixed period of time and then give the remainder to the charities.
When they wanted to support their medical school, the Columbia University College of Physicians and Surgeons, they established a charitable lead trust, which pays a certain percentage of the assets to the school each year and, after a fixed period of time, will benefit the couple’s eight grandchildren. “We have felt that we owe something to the schools that educated us, and we have given to just about all of our schools,” Ronnie says. They have endowed a professorship in her father’s honor at Haverford, helped fund the expansion of the science building at her Quaker high school, and contributed scholarship funds to Brown University, Ronnie’s alma mater. They also established two charitable annuities in support of the Museum of Fine Arts, Boston.
The couple does much of their giving through their Donor Advised Fund at the Boston Foundation. “When I first learned what Donor Advised Funds were, I was instantly attracted to the idea,” she says. “I knew I did not want to establish a private foundation – it’s a lot of red tape and has lots of regulations. With our DAF, there’s no bookkeeping, no forms to be filled out.”
She says the DAF makes it simple to direct grants to the many organizations they contribute to each year. She also occasionally taps into the Foundation’s in-house expertise, as she did last year when she wanted to contribute to a major effort against teen pregnancy. That resulted in a $100,000 grant to the Planned Parenthood League of Massachusetts for its “Get Real” sex-education program in middle and high schools.
“I’m very interested in having wanted families in this world, and I unfortunately have seen a number of adolescents who got pregnant, one of whom was a 13-year-old girl,” she says, noting that unplanned children can derail teens from reaching their goals and consign them to a lifetime of difficult circumstances.
The Petersens have also named the Permanent Fund for Boston as the beneficiary of their Individual Retirement Accounts (IRAs) and are regular givers through their DAF to the Foundation’s Civic Leadership Fund.
“A DAF is amazingly simple, and for us, it means we can give more because we use appreciated securities to fund it, rather than our bank account,” says Ronnie. “It’s a phenomenal advantage.”