Many advisors recommend a charitable vehicle for their philanthropic clients as part of their overall wealth management strategy. And for many advisors, the default recommendation for high-net-worth individuals and families is often a donor-advised fund (DAF). After all, they’re quick to set up, simple for the client to use, and require minimal ongoing effort to manage.

Although DAFs are a great option for many, in certain circumstances, a private foundation could be a better choice. Neglecting to consider this option could be a potential disservice for your philanthropic clients. Unfortunately, a private foundation is often dismissed out of hand because advisors may believe that they are inherently expensive, complicated, and time-consuming, both to set up and to manage. And unless the client is going to fund it with at least $5 million, many contend it just doesn’t make sense.

That was true 20 years ago, but not today. Times and private foundations have changed. Private foundations can be established quickly, with less than $1 million, and, thanks to the advent of outsourced management firms, are as easy to administer as a DAF but with some potentially important advantages.