Question: What is an endowment fund?

Our PATT is having a fund raiser and I was told all the money goes to the endowment fund by the president but other parents told me that it goes to scholarships, operating expenses, and curriculum. Can someone please tell me what an endowment fund is? No one seems to really know at our school that I have asked.

Asked by amditta



Advice from PTO Today

Craig writes:
An endowment fund is typically money that you invest for the long-term. You might use the investment income from the endowment for your year-to-year operations, but the bulk of the money generally stays invested for the long-term health of the organization. To be honest, not many parent groups have endowment funds -- they're not able to raise enough money to feel comfortable making that kind of investment. If you do have an endowment, I'm guessing it might be specifically for the scholarships. Your treasurer should know exactly what accounts and investments you have -- it might be worth asking her for the details.

Answer this question: