- A percentage of the interest is re-invested into the fund in order to allow the principal to grow each year.
- A percentage of the interest is utilized to fund the particular budget item for which the endowment was created.
For instance, if a scholarship endowment has $1,000,000 in principal and it is invested with a 5% rate of return, $50,000 in interest will be used in various ways. A percentage of the interest (let’s say 50% to use round numbers) will be used that year to fund scholarships. So $25,000 will go directly to offset tuition costs for students. The remaining percentage will be re-invested to build the fund. Therefore $25,000 will be added to the principal so that in future years the fund will grow larger and more each year can be used to fund scholarships directly. Endowments are established through major gifts when the donor desires that the gift “keep on giving” over the years. Smaller gifts may then be given to add to the endowment at any time.
The King’s Academy currently has four endowments:
- M. Nelson and Jane Loveland Scholarship Endowment
- James and Annie Erneston Scholarship Endowment
- Faculty Development Endowment
- Building Maintenance Endowment
Endowment gifts have a significant impact on identified funding priorities and support the long-term financial stability of The King’s Academy. If you are interested in contributing to one of our established endowments or establishing a new endowment, please contact Rosario Larson at (561) 686-4244, Ext. 319.