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An endowment can be a great way to gift money or property to an institution. It stipulates that the gift be invested and the principal always remain intact. This means that the institution will have a continuous flow of funds from the interest.
There are many types of endowments that are used to fund different activities. An endowed professorship (or endowed chair) is a position at the university that is permanently funded by the endowment that has been set up. Many of these chairs are highly competitive and sought out by educators. These endowments allow the giver to ensure that an educational avenue that they deem important is always staffed with quality professors.
This practice of endowing professorships has been around for centuries. It began in England in 1502 at Oxford and Cambridge. Today, most universities require that a professorship endowment begin at one million to three million dollars.
There are also scholarship endowments that are designed to help the students in their quest to receive the best education. A scholarship endowment is used to provide tuition (and often other costs associated with college) to a student for either the full term of their education or on a per year basis. There are also scholarship endowments specifically for doctorate and other advanced studies.
At many universities, only 5% of the endowments assets are spent each year. The remaining money is rolled back into the endowment investment in order to increase its affects.
Endowments are now finding their way into the primary and secondary educational systems. Some states are developing endowment kits to encourage individuals to donate their monies and properties to help the struggling public educational systems.
Which ever institution catches your eye, an endowment can be a great way to put your mark on it. Not only is it a legacy for you and your family, it is also a hopeful future for the many people that will pass through the doors of the institution.