Endowment

An endowment is a pool of donated assets invested to provide ongoing financial support to an institution or cause. Its governing rules typically restrict how much can be spent and preserve some or all of its principal.

Endowment fund: A dedicated pool of assets whose investment earnings or principal support a specified institution or purpose. This is the fund structure through which an endowment’s assets are held and managed.
Charitable trust: A legal arrangement holding assets for charitable purposes under fiduciary oversight. Many endowments are organized as charitable trusts with legally defined purposes.
University endowment: An institution’s invested charitable assets used to support its educational mission over time. Universities use endowment distributions for scholarships, research, faculty, and operations.
Annual fund: A fundraising program that solicits gifts intended for use in the current or near-term budget. Unlike an endowment, it generally raises spendable gifts rather than preserving invested principal.
Intergenerational equity: A principle of fairness in distributing benefits, costs, and resources between generations. Endowment spending rules embody choices about how much support to give now versus later.
Spending rule: A policy that sets how much of an investment fund may be distributed for use over a period. It controls distributions while balancing present needs against future support.
Perpetuity: An arrangement or condition intended to continue indefinitely. The aspiration to preserve principal indefinitely shaped endowment restrictions and governance.
Foundation (nonprofit): A nonprofit organization that makes grants or conducts charitable work using dedicated resources. Private foundations commonly invest assets and distribute part of them for charitable purposes.
Operating reserve: Cash or liquid assets set aside to cover an organization’s unexpected needs or temporary shortfalls. Reserves provide short-term financial flexibility; endowments are usually designed for long-term support.
Institutional autonomy: An institution’s capacity to govern its affairs and pursue its mission independently. A large endowment can reduce reliance on governments, donors, or markets for operating funds.

Linked from 10 pages