Exploring Endowments

Endowments by the Numbers

Endowments typically rely heavily on large, single contributions. These large contributions have lasting impacts, allowing schools to fund financial aid, faculty positions, and facility improvements.

The Council for Advancement and Support of Education (CASE) and NAIS regularly collect advancement data for independent schools. In the 2023 edition of CASE Insights on Philanthropy in Independent Schools, 370 responding schools indicated a total of $2.26 billion in new funds committed.

• 38.7% was designated for property, buildings, and equipment
• 27.9% unrestricted funds
• 20.7% funds for endowment

“New funds committed” include monies and property committed by any individual or qualified organization. These funds include outright gifts, the full value of new documented pledges, new irrevocable planned gifts received or committed, and new qualified and documented bequests or legacy intentions if the donor is age 65 or older.

What’s Essential October 2024

Establishing an Endowment

Independent schools establish endowments for several important reasons:

• Financial stability: provides a steady source of income, buffers against economic downturns or fluctuations in enrollment.
• Long-term sustainability: ensures the school’s financial health and ability to operate in perpetuity.
• Enhanced programs: funding academic programs, extracurricular activities, or facilities improvements that might otherwise be unaffordable.
• Tuition control: keep tuition increases in check, making the school more accessible to a broader range of students.
• Competitive advantage: attract top faculty and students, enhancing the school’s reputation.
• Financial aid: support scholarships and financial aid programs.
• Innovation: provides resources for new initiatives, technology upgrades, or experimental programs.
• Emergency preparedness: a financial cushion for unexpected events or crises.
• Independence: reduces reliance on tuition and external funding sources, giving the school more autonomy in decision-making.

What’s Essential October 2024