One of our clients, People Inc. Foundation, recently asked us to put together frequently asked questions about what an endowment is for a publication they were sending out. Andrew Gaerte, Director, Client Relations at the Community Foundation, provided these answers about the power of endowment.
What is an endowment fund?
An endowment fund is one in which the original gift remains intact and is invested for long-term growth. Each year, a portion of the earnings generated by the investments in the fund will be used to support the work of People Inc. Over time the endowment fund will continue to grow all while providing predicable and sustainable funding to People Inc. each year.
How does this endowment fund benefit People Inc.?
The creation of the People Inc. Foundation Endowment Fund reflects the stability, fiscal responsibility, and vision for the future of WNY’s largest non-profit organization. The funding generated by the endowment can support a beloved program, provide stability for a changing future or be used to make a strategic investment to advance People Inc.’s mission.
How does this benefit our supporters?
Giving to the People Inc. Foundation Endowment Fund or creating a new endowed fund in support of the People Inc. Foundation is a wonderful way for supporters to secure their legacy of generosity. If you love People Inc. and the work they have done for your loved ones or the community, a gift to an endowment fund is a gift that will grow and support the organization for generations to come.
Can you give an example of how an endowed gift can grow over time?
At her death in 1975, a widow gifted $400,000 to the Community Foundation for Greater Buffalo to create an endowed fund as a tribute to her late beloved husband. By the end of 2016 the fund had more than tripled in value to $1.3 million, all while distributing over $1.6 million to charitable organizations in her community.