Pes550 - Final Exam (Endowments & Planned Giving)

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-Stanford University

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Largest Athletic Endowment in country

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-Harvard University

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Largest Overall Endowment in country

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-created with original gifts consisting of money or stock

-can provide long-term financial support over years

-last forever

-provides a stable source of income in future

-focused on long term

-usually comes from high dollar donors and mostly philanthropic driven

-downside: difficult to start and maintain focus because it is not a solution for financial problems "today"

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Endowments

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-fully endowed scholarship needs $750,000
-Endowed money generally pays about 5% interest
- $35,000 needed to start endowment at Stanford

(Texas starts at $350,000)

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Stanford Endowments

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-Example: John Jones scholarship = $100,000

John Jones Football Scholarship = $500,000

John Jones QB Scholarship = $1,000,000

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the more specific an Endowment is, the more you can charge for it

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-develop endowments that large groups can sponsor
-ex: graduating classes, alumni groups, past team

-create in the name of a successful, well-liked coach

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Endowment suggestions

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Planned Giving (aka Charitable Gift Planning)

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-making a charitable gift of estate assets to one or more nonprofit organizations

-nonprofit orgs. often employ planned giving officers (PGO's) to work w/donors

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-Charitable trust
-Charitable lead trust
-Charitable gift annuity

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Examples of Planned Giving

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-provides income to donor for a time period; then remaining assets go to a non-profit; called a charitable remainder trust

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Charitable trust

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-opposite of charitable trust

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Charitable lead trust

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-donor makes gift to charity, receives set amount of $ every year for rest of life, could name a different annuitant

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Charitable gift annuity