Understanding Endowments

What is an endowment?

An endowment is a charitable gift that is invested and managed in a way that allows it to provide an income stream to the beneficiary while maintaining the gift's purchasing power in perpetuity.

How does an endowment work?

The LSU Foundation's goal is to strategically invest endowed funds in a diverse pool of accounts to earn a long-term rate of return that will, over time, maintain the funds' purchasing power, while providing an annual income stream to the beneficiary.

What will a more substantial endowment mean for LSU?

The LSU Foundation endowment has more than doubled since 1999, when it was $140 million. Yet, even with this impressive growth, many major public research universities with which LSU competes have endowments well in excess of $500 million. The endowment takes on a disproportionate importance at LSU because of constraints on state appropriations and tuition increases.

The LSU Foundation seeks to at least double the size of its endowment. This will be accomplished through a substantial infusion of gifts for endowments and continued effective management of the endowment principal to generate earnings through investments. This sustained source of annual income would have a tremendous impact on strengthening academic quality. It would allow the University to compete at the highest levels nationally in recruiting and retaining superb faculty and talented students, while creating an environment where they can thrive. A larger endowment would also vastly expand LSU's ability to drive economic development and boost the quality of life for all the state's citizens. 
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