Are you wondering about funding through a grant or gift endowment? If so, you will be surprised to know that both provide security for the future while supporting a range of projects and programs that are of specific interest.
About Endowment Funding
Endowments are set up to secure the future for an organization. They are invested in a way that the principal is preserved while the income made from the interest is used to support various programs and operations. Endowments are often created as a bequest so that the donor's legacy lives on. Many are created as a way to make sure that future generations are guaranteed stable funding despite what happens in the economy. Since the initial amount of the endowment is never touched, it can never lose money. Endowments can grow over time giving them an expanding source of funding.
Endowments can be made through various options. They can be set up while the donor is alive or after they pass away. If the endowment is set up while the donor is living, it can be funded by various means such as:
- Real estate
If the endowment is to be created after the donor passes away, it can be funded through a retirement plan, insurance policy or as spelled out in a will bequest.
Types of Endowments
There are various types of endowments. Some are set up as a memorial gift in honor of someone who has passed away while others give grants to qualifying organizations.
One type of endowment option is a gift endowment. This type allows for a gift to be made to the endowment in honor or in memory of someone. An endowment can be set up bearing an individual's or family's name.
It is up to the donor to specify how the money is to be used. Gift endowments can be either restricted or non-restricted. If the fund is unrestricted then it can be used whatever way it is most needed. Restricted funds are limited to specific activities spelled out by the endowment..
Universities are a popular setting for gift endowments. This type exist to support various programs of the university and can be set up in a specific donor's name so that their legacy lives on forever.
Another type of endowment is a grant endowment. This type actually grants funds to various organizations for purposed designated by the endowment. It is up to those who establish the endowment to decide how they wish to grant the money.
Endowment grants can support a variety of programs. An organization must follow guidelines spelled out by the endowment when applying for a grant through an endowment. The endowment may specify the area that they wish to fund, the amount of funding available as well as any restrictions. For example, some endowments cannot be used to fund general operating expenses or for programs that are not located in a specific region.
Examples of Grant or Gift Endowments
A grant or gift endowment can provide stability for future generations. Either type has its benefits and can provide funding for various areas of interest.There are numerous grant and gift endowments in existence. Some examples to check out include:
- The National Endowment for the Arts grants funding for specific areas of interest. An arts organization can apply for a grant in one area only. The areas include Access to Artistic Excellence, Challenge America Fast-Track and Learning in the Arts for Children and Youth.
- Another grant endowment is the Lilly Endowment. It grants funds for three specific program areas. The areas are community development, education and religion. They also have interest in programs that benefit youth, build philanthropic leadership and education as well as those that promote volunteerism.
- Gift endowments are often set up at universities. An example would be the Berkeley Endowment. This endowment supports students, faculty, and programs over an extended period of time. Other gift endowments include Butler University Endowment, Ever Elon Endowment and Clemson University Endowment.