Dive Temporary:
- The worth of school endowments collectively grew 4% in fiscal 2024 because of a mix of sturdy funding returns and an increase in donations, in keeping with the most recent information from the Nationwide Affiliation of School and College Enterprise Officers and asset administration agency Commonfund.
- The overall worth of the endowments of the 658 establishments that participated within the research reached $873.7 billion for the yr, with a median endowment worth of $243 million. Of the survey respondents, 144 had endowments of $1 billion or extra, comprising roughly 86% of the overall worth reported.
- Presents to endowments rose to $15.2 billion from $12.7 billion final yr, in keeping with the research. Attracts on funds rose as properly, by 6.4% yr over yr to $30.1 billion in spending at establishments.
Dive Perception:
Funding returns remained sturdy by 2024, supporting establishments’ spending from their endowments. Ten-year common annual returns stood at 6.8% for fiscal 2024, down barely from final yr however nonetheless sturdy sufficient to make spending with endowment cash “attainable and prudent,” NACUBO and Commonfund stated in a press launch. The common one-year return hit 11.2%, a 3.5 share level enhance over 2023.
On common, endowments funded 14% of establishments’ working funds, up from 10.9% in fiscal 2023, in keeping with the NACUBO-Commonfund research.
Scholar support represented the biggest share by far of endowment spending, at 48.1%, adopted by educational packages and analysis at 17.7%.
Schools spend the biggest share of endowment funds on scholar monetary support
Endowment spending distribution by operate in fiscal 2024
“School and workers actually profit from this philanthropy, however college students stay the first beneficiaries, as the majority of those assets is used to keep up scholar support and affordability,” NACUBO President and CEO Kara Freeman stated in a press release.
The listing of the largest endowments appears to be like similar to that of years previous. Within the No. 1 spot, as soon as once more, is Harvard College, with a worth of about $52 billion, up 5% from final yr. Harvard is adopted by the College of Texas System ($47.5 billion) and Yale College ($41.4 billion).
Harvard College has the biggest endowment — once more
Endowment sizes in fiscal 2024 by complete market worth and worth per scholar
These rich endowments are as soon as once more within the highlight as President Donald Trump and Republicans eye greater tax charges on schools’ funding funds.
Throughout Trump’s first time period, he signed a tax invoice containing a 1.4% levy towards the funding revenue of personal schools whose endowments are valued at $500,000 or extra per scholar. Home Republicans this yr floated a plan to jack that price as much as 14%. Others have proposed but greater charges, together with 21%, to be in keeping with the identical charges paid by for-profit firms.
NACUBO addressed the politics round endowments in its launch of the most recent information.
Pointing to how establishments use their endowments on scholar support and different core features, Freeman stated, “That is extremely vital work and demonstrates how short-sighted it could be to additional tax these funds and divert them from their true objective.”
Mark Anson, Commonfund CEO and chief funding officer, stated at a Tuesday media briefing that establishments must take an in depth take a look at post-tax funding returns ought to greater charges grow to be regulation. That would in flip push many to have a look at extra aggressive investing methods, whereas others would doubtless see the share of their operations financed by endowments fall, Anson added.
