Endowments are imperative for schools, because they provide schools with long-term financial resources that schools need in order to grow and succeed. They are helpful in creating pools of funding, the returns from which can be used for special projects, capital improvements, and scholarships. In tough times of rising operating costs and flat or decreasing enrollment, endowments can serve as an extra lifeline by providing supplemental income.
In order to grow into a stable and sustainable institution, it is crucial to have a significant endowment. We have four recommendations to help you grow your endowment to give your school the edge:
- Show your impact: Encourage philanthropists and alumni to donate by explaining the positive impact the school has on the community. Take it a step further by inviting them to the campus to see the impact of their contribution. Let them take a tour of a new building or see a sporting event or production put on by the students.
- Create new purposes for giving: Instead of requesting traditional contributions, ask for gifts on special occasions or even after tax returns. This can be achieved by encouraging students or faculty to do a Facebook birthday campaign or possibly a timely holiday mail campaign. Encourage potential donors to reach out to their companies or foundations, as well.
- Do what works for your school: Create an investment policy that aligns with your school’s endowment, and carefully manage spend rates on the investments. The investment portfolio should also be in line with the school’s endowment size and overall strategy.
- Request assets other than cash: Appreciated assets like stocks, real estate, or collectibles with value will offer tax benefits to the donor, while providing valuable resources to the school. Assets like equipment or vehicles could be of direct use to the school and fill needs and allow the school’s own funds to be used for other purposes.
For more information about endowments, please contact Dan Kelley or one of our nonprofit specialists at 301.231.6200.