endowment funds

[oldu]

The Sunday New York Times had an interesting story in its education section which listed college endowments in terms of $/student instead of totals. It was astonishing that 12 schools have endowments of almost ONE MILLION DOLLARS OR MORE PER STUDENT! Tops with over two million was Princeton, followed by Yale, Harvard, Stanford, Pomona, Grinnel, Amherst, Swarthmore, M.I.T., Rice, Williams and Cal Tech. That relates to $30,000-50,000 per student in annual endowment income. By the way, tuition at all of the above is also in excess of $30,000 annually. It would be interesting to see fraternity and sorority endowment figures the same way to determine how much of the cost of today's Greek membership is subsidized by those who preceded them. It might be a good selling point.

[Kevin]

Not having a local endowment fund makes it tough on new chapters to get going. A few of us from my chapter have been working on establishing one. Sigma Nu's HQ has a pretty good program. Instead of going off and starting our own fund, our HQ has a Chapter Educational Foundation set up.
We donate money to the 501(c)(3) CEF. A small per diem fee goes to the purposes of the general fraternity. The fund is professionally managed and there's a pretty decent annual income on the investment. We're working right now to endow our LEAD program. After we get sufficient money, we can basically write our own mortgage out of the CEF. We pay the interest and principal for the loan back into our own foundation. I'm sure most everyone has a similar program.

We're also banking on the fact that eventually, the Collegiate Housing and Infrastructure Act will be finally passed.

Having looked at the numbers, in 30 years or so, we can have a pretty respectable amount of money in that foundation, and yes, the cost of membership will be highly subsidized by alumni donations. At this point, I think we're playing catch-up on campus -- at least if the alums of the organizations which have been around a lot longer than us were forward thinking in the least.

I'm sure for chapters which have six-figure social budgets are heavily subsidized by those who came before them.

[wildcatfan]

Originally Posted by oldu

The Sunday New York Times had an interesting story in its education section which listed college endowments in terms of $/student instead of totals. It was astonishing that 12 schools have endowments of almost ONE MILLION DOLLARS OR MORE PER STUDENT! Tops with over two million was Princeton, followed by Yale, Harvard, Stanford, Pomona, Grinnel, Amherst, Swarthmore, M.I.T., Rice, Williams and Cal Tech. That relates to $30,000-50,000 per student in annual endowment income. By the way, tuition at all of the above is also in excess of $30,000 annually. It would be interesting to see fraternity and sorority endowment figures the same way to determine how much of the cost of today's Greek membership is subsidized by those who preceded them. It might be a good selling point.

This isn't where oldu meant to take this story, but I happened to see a recruitment letter to my high school junior daughter lying by the computer as I read his post. I don't want my post to be construed as putting in a plug for Yale (and I understand other expensive private universities have recently adopted similar tuition policies), but I quote from the letter:

"In January [2008], we announced dramatic improvements to our financial aid policies. . . Families with annual incomes under $60,000 are no longer asked to contribute to the cost of sending a child to Yale. Those with incomes between $60,000 and $120,000 will pay from 1% to 9% of their annual income, and families from $120,000 to $200,000 will pay an average of 10% of income."

With endowments like that, it is easy to see why the universities could afford to subsidize tuition based on financial need. It looks like they are putting those resources to good use. Of course it will already make a very competitive admission process that much more competitive!

[LPIDelta]

The large endowments at those universities are under scrutiny, primarily by members of congress, and so many more of them will start to offer such tuition plans. The reality is, they can do this and their endowments will not be hurt. Especially when you consider that those students will be able to be generous to the school immediately because they likely will not have student loans and feelings toward their alma mater may be generally more warm and fuzzy.

As far as fraternities and sororities go, endowments are incredibly beneficial, something alumni need to consider when asked to give. An endowment helps secure the future of the entire organization by providing a consistent stream of income for educational and philanthropic programming, a large chunk of the organizational budget. And its not just endowments, but gifts in general that subsidize membership dues in many organizations--I know there are several sorority Conventions where the members pay a minimal amount to attend because the programming is almost entirely funded by foundation gifts or endowments. And away from conventions, there are many, many fraternity/sorority programs that have been "sponsored by" an individual or organization, ensuring that the cost is not passed on to members.

Gifts to fraternities and sororities are absolutely vital to ensuring that our organizations remain relevant and that the cost remains affordable. Something we all need to remember long after graduation...