What is the function of an endowment and why are they important to charitable organizations?
Unlike expendable funds, which typically come in to an organization and are used for immediate needs (like our annual funds), endowment funds are invested in long-term securities. While the principal will never be spent, annually a portion of the income is made available to the organization. Some individuals choose to create an endowment restricted to a particular purpose. Other individuals ask that their gift be placed in the organization's general endowment and used for the general good of the organization. Endowments are critical to the long-term stability of the Center. They increase our ability to predict one revenue stream and act as a buffer to both political and economic fluctuations. Because an endowed fund is in perpetuity, an endowed gift has both an immediate and a long-term impact on the Center… therefore reaching lives today and forever.
What is the Center’s endowment?
The Center has been fortunate to have many dedicated friends who not only appreciate the mission and lives touched by our work but also want to put their values in action and support the Center's work. Many individuals have chosen to create an endowed fund restricted to a particular dimension of the Center. A wonderful example of this would be an endowed scholarship. This allows the donor to transfer a sum of money in to our endowment, the Center receives a portion of the interest income (current University policy is 5% annually) to go toward the scholarship, and the remaining growth is added to the endowment principle. Over time, this original investment grows exponentially and each year a scholar is supported by the original gift.
Other donors make a contribution to the endowment and do not restrict its use. This allows the Center to receive a steady stream of undesignated dollars each year for new or existing programs and funding opportunities as they arise.
We welcome the opportunity to talk with you about your interest in the Center
Please contact Betsy Wilson at 734.764.7291, or email, ecwilson@umich.edu
CEW, 330 East Liberty
Ann Arbor, Michigan 48104.2274