What is an Endowment?

Glossary

Clarkson's endowment is a pool of assets set aside and invested. Assets (the principal) may include cash, securities, real estate and real property. Investment strategies balance income and growth.

A portion of the annual investment income is spent by Clarkson, and the remainder of the income is added to the endowment principal. Each year Clarkson spends income equal to 4.5% of the value of the endowment averaged over the past 12 fiscal quarters (the last 3 years). All income over this 4.5% level is reinvested to increase the value of the principal, and increase income the following year. Thus, in any given year, if the value of the return on investment is 8%, 4.5% is spent on programs and 3.5% is added to the principal.

Portions of endowment may be permanent (the principal is not spent), or "quasi" (the principal may be spent). Portions of endowment may be restricted to specific purposes. The term "endowed fund" is often used to describe a named portion of a larger endowment. For example, a donor may create "The Smith Endowed Fund for Scholarships,” a permanently restricted segment of the larger endowment that is used to generate support for student scholarships.

Gifts of any amount may be made at any time to existing endowed funds. A minimum gift or pledge is required to create a new endowed fund (see examples below). A pledge may be fulfilled generally within five years.

When an endowed fund is created, guidelines are drafted to determine how the income may be used. Guidelines may be specific (e.g., scholarships to students from the North Country region of New York State), or broad (e.g., general operating support for a specific academic department).

Individuals who fund endowments are eligible for membership in the Annie Clarkson Society. Contact the Society for further information.

Endowments are often planned as bequests or other types of deferred gifts. Guidelines can be drafted and retained on file until such time as the gift is received and the endowed fund created. These are often created as a legacy or memorial (e.g., "The Jones Family," or "John Jones Memorial Endowed Fund").

Gifts to endowments may count in the Evolution to Excellence fundraising campaign, in your next anniversary reunion, and towards Roundtable annual recognition. Contact the Annie Clarkson Society for help related to your unique circumstances.

Your employer may match your endowment gift. Visit our Matching Gift page to find out if your employer will match your gift, and how to initiate the process.

Clarkson Endowed Fund Minimum Levels

See Endowments and Naming Opportunities for more gift ideas.

This web page does not provide legal or financial advice, nor is it a comprehensive review of the topic. You should consult your legal and financial advisors and Clarkson University before making or planning your gift.

 (rev 5/2013)