If you've read this blog, you know how critical I am of university endowment funds. My main criticism is that all these funds seem to do is grow. They're rarely used to enhance a university's assets or aid students.
Taxprof Blog has a post about the average payouts of college endowments funds. On average, funds grew by 17.6% last year, yet paid out only 4.6% to students. Private foundation tax laws require a payout of at least 5% of assets but university endowments are exempt. If you want to see your school's endowment activity, click here.
I've always wondered why people give to these funds rather than donating to their local public school, who could use the money. All you're doing by contributing to a university endowment is throwing money into a black hole.
For full disclosure, I donate $500.00 a year to UCATS (UC's athletic scholarship fund), I do this since I was a recipient of an athletic scholarship and the money is used to fund those scholarships.
For crying out loud the Harvard endowment is now worth over 30 billion dollars. What are they waiting for?......... the apocalypse? That amount of money could pay for the tuition of 750,000 students.
So do something productive with your money. Instead of buying that $50 alumni plate, send a check to some place that will use it.
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