Bard College Completes Its Landmark Endowment Challenge
By meeting the challenge, Bard has established the first endowment in its history, positioning the college to sustain and expand its mission as an independent institution of higher education centered on the liberal arts and sciences and dedicated to the public interest for generations to come.
What Is an Endowment?
An endowment is a pool of invested assets created to provide a financial return to a nonprofit institution. By maintaining the investments over a long period of time, a portion of the financial returns provide a steady stream of cash income called the endowment draw.
An institution’s trustees set spending controls to ensure that the endowment draw is consistent and does not exceed the returns on the endowment’s assets, which allows income to accrue in perpetuity. The draw amount, often 5% of the principal amount, is what is available in any given year.
An institution’s trustees set spending controls to ensure that the endowment draw is consistent and does not exceed the returns on the endowment’s assets, which allows income to accrue in perpetuity. The draw amount, often 5% of the principal amount, is what is available in any given year.
How Will the Endowment Affect Bard?
This larger endowment will provide an important additional stream of income to sustain Bard and will act as an insurance policy when other forms of income are under pressure. In that sense, it eliminates existential risk and sets Bard on a pathway of greater financial self-determination. Endowment funds must be invested for at least a year before the institution can take the endowment draw. The College will be able to meet its existing budgets without having to sacrifice quality to pursue its mission.