An endowment is an investment in the future. An endowment is an invested gift that generates income to be used, in perpetuity or as the donor directs, to support Louisiana Tech. Because endowments generate funds indefinitely, they are often referred to as "the gifts that keep on giving." When you establish an endowment, your gift is invested with two goals in mind: to make the principal grow faster than inflation, and to provide spendable income for whatever specific purpose you designate.
Tech's endowment is its financial foundation. Endowment income provides security and protection that balance the other sources of income for Tech which tend to fluctuate: tuition, state support and annual gifts. A steady, increasing endowment income can mean the difference between merely sustaining the status quo and aspiring and achieving new heights of excellence.
Because endowments generate support forever, they are especially valuable and appropriate for donors who wish to leave a legacy at Louisiana Tech.
The most common endowments are those created to fund student scholarships. Tech has always been known for its outstanding students, and scholarships play a vital role in Tech's ability to attract quality students. To build on this tradition and to remain competitive with other national institutions, Tech needs additional endowments to attract and reward academic excellence.
Scholarship aid is important because the cost of a quality education is high. The current cost of a Tech education is approximately $11,000 per year for an in-state student, including tuition, student fees, housing, meals and books. Though this figure compares favorably with other institutions, it is a hardship for many worthy students. Greater scholarship endowments would mean students wouldn't have to rely so heavily on loans or devote so much time during the academic year to earning money to pay for education expenses.
Melvin McCann, a 1940 Tech graduate, explained his reasons for funding the largest scholarship endowment in Tech history. "I'm sincerely glad to contribute to the welfare of education and to scholarships. I know I had a hard time getting through school. I had to work the whole time I was there. If I had had an endowment, I would have had a lot of time that I could have been studying rather than having to work. This is my primary purpose 'to give other students a little push."
Other Types of Endowments
Endowments can be created to provide income for any area of the University that the donor wishes to support. Examples of other types of support are specific academic programs, the library, textbooks, athletics and lab equipment.
Establishing an Endowment
An endowment requires a minimum balance of $20,000 to be fully endowed. This minimum can be reached over a period of up to three years. Donors can also use corporate matching gifts, if available, to fund the endowment. Donors have the ability to name the fund. The fund becomes part of the Foundation's Endowment pool, but it maintains a separate identity as a specific account. An endowment agreement that specifies the name and purposes of the endowment is completed at the time of its establishment. For scholarship endowments, donors have the ability to designate many of the criteria for the awarding of the scholarship.
Endowment Fees and Administration
When an endowment is created, an administrative fee of 5 percent is charged by the Foundation and assessed against the endowment pool. A fee of 1 percent is charged annually for the maintenance of the endowment. All endowments of the Louisiana Tech University Foundation are managed by investment professionals according to guidelines established by the Foundation Board of Directors.
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Cash, Securities and Stock Transfers
Endowed Professorships and Chairs
Corporate Matching Funds
State Matching Funds