Endowment gifts are never spent. Instead, they are prudently invested according to the University's Investment Policy.

Each named endowment produces earnings year after year which are spent according to the donor's wishes, such as for scholarships, faculty support, or to build the library collection. Annually, amounts are withdrawn from the pooled endowment to fund the specified purpose. Endowment spending typically ranges from 4.5 percent to 4.75 percent, and is sourced from net realized and unrealized investment gains. The original value of any gift to endowment will never be spent. Should the estimated annual calculated spending exceed the net realized and unrealized investment gains, the spending is funded from University unrestricted funding sources. As a result, the donor specified purpose will always be funded annually, regardless of investment performance.

An endowed fund could be compared to a "magic" cup that seemingly refills itself each time it's emptied. In the same way, Gonzaga has many funds for scholarships and other programs that are replenished year after year once the money is spent. But it's not magic. So what is the source? It is the generous gifts given by benefactors, gifts which are never spent, but which will provide replenishment again and again into perpetuity. What an amazing way to touch so many lives.

Endowment gifts are distinct. They don't become a part of the physical campus, like a building or statue, yet they are more durable than bricks and mortar and will outlast virtually any other kind of gift. Not only that, but the name given to an endowment will live on at Gonzaga forever and serve as a living testament of individuals that are helping to impact the lives of students, forever.

Endowment Q&A:

What is an endowment?

An endowment is a fund that lives on in perpetuity because only a percentage of the earnings are spent; protecting the corpus, ensuring the original investment will not be lost. Gonzaga's endowment is a collection of named endowed funds that fulfill the mission of the University and support a variety of learning and enrichment opportunities for students. With the expansion of endowment support, more students can be served through scholarships, academics, student life, mission-centric programming, faculty enrichment, and other University operations.

How does Gonzaga's endowment fulfill the mission?

First and foremost, providing students with an education that transforms them into men and women living for others is an unending endeavor at Gonzaga. In the same way, the endowment is a funding vehicle that supports our capacity to fulfill our mission forever. A strong endowment reduces reliance on tuition revenue and the burden this places on parents and students, while also delivering programmatic funding, faculty chairs and a number of other resources, far into the future - with no end date.

What is Gonzaga's investment philosophy?

Gonzaga University's investment philosophy is to maximize return on assets by exercising an appropriate level of risk; providing income for the benefit of our students and honoring a donor's intent for the gift and growth of their investment into perpetuity.

What are permissible investments for endowment funds?

Permissible Investments*:
Equities:

• Common Stock
• Convertible Preferred Stocks
• Convertible Bonds
• Preferred Stocks
• Foreign Equities Listed as ADR
• International Equities
• Regulated Mutual Funds (including index funds)
• Exchange Traded Funds

Fixed Income:

• U.S. Government Securities
• U.S. Government Agency Securities
• Corporate Bonds
• Mortgage Pass-Through Securities
• Asset-backed Securities
• Collateralized Mortgage Obligations
• Bond Mutual Funds
• International Bonds
• Exchange Traded Funds

Cash Equivalents:

• CD and Bank Repo
• Commercial Paper
• Bank Repurchase Agreements
• U.S. Government Securities
• U.S. Government Agency Securities
• Money Market Mutual Funds

Prohibited Investments:

• Direct Real Estate or Mortgages without prior Committee approval
• Commodities or Commodities Contracts
• Securities purchased on margin* *
• Short Sales* *
• Restricted Stock
• Options, except covered calls* *
• Derivatives* *
• Private Placements or Partnerships without prior Committee approval
• Any transaction or investment that could be deemed to be a conflict of interest or inappropriate under the prudent Investor standard

**Permissible when used as part of a regulated mutual fund, a hedge fund, fund-of-funds or multi-asset managed fund

What is the current endowment spending for fiscal year 2011?  

A total of $5,710,283 is being spent in fiscal year 2011 from the endowment. Of that total, $3,661,244 is allocated as student scholarship spending, $1,114,649 is allocated to faculty chairs and academic programs, and $934,390 is for other purposes. Endowment spending represents approximately 2.3% of the overall University operating budget. The spending for student scholarships represents approximately 5.2% of the total institutional financial aid budget.