taxable expected utility DAF expected utility winner
investment return (%)
standard deviation (%)
relative risk aversion
external capital (as multiple of personal capital)
initial tax hit (%)
dividend yield (%)
tax rate (%)
value drift risk (%)
administrative fee (%)
expropriation risk (%)


This calculator models the expected utility of using a donor-advised fund vs. a taxable account for an altruistic investor.

Most of the default values used in this calculator are explained by the associated essay: Donor-Advised Funds vs. Taxable Accounts for Patient Donors

The default values for investment performance are derived from historical data from Meb Faber's book, Global Asset Allocation. Investment returns are net of inflation, and assume a real risk-free rate of zero. The numbers given are based on historical performance, which might not reflect future results.


  • Money given to charitable causes obeys an isoelastic utility function, parameterized by the "relative risk aversion" input value.
  • The investor using this calculator is small relative to the commuity of value-aligned investors, and therefore has approximately linear utility of money.
  • Both the DAF and the taxable account invest in the same assets, but the taxable account can use leverage and the DAF cannot. The cost to use leverage equals the risk-free rate.
  • The investor's assets are perfectly correlated with the overall altruistic portfolio.