What is an endowment and how can 4-H benefit?

Michelle Neff<hydemich@msu.edu>, Michigan State University Extension -

Have you ever heard the word endowment and wondered what that meant? This article will explore what an endowment is and how it can be used to impact 4-H programs.

The definition of endowment, according to Merriam Webster Dictionary, is a large amount of money that has been given to a school, hospital, etc., and is used to pay for its creation and continuing support.

An endowment can be set up by many different organizations, but the most popular organizations that use endowments are schools (universities and community colleges) and foundations says Michigan State University Extension. Many organizations will create a charity foundation that have many different or one big endowment that funds are given to.

In the case of 4-H, many state 4-H programs have 4-H foundations to help support the 4-H program.  In Michigan, the Michigan 4-H Foundation accepts donations to many 4-H program areas and enables the donor to use the donation as a tax write off.

Locally, county 4-H programs can establish endowments for their specific county program. They could have more than one if they wanted to have an endowment for a specific purpose or general operational support. There is no limit to the amount of endowments that can be established to support a program.

How an endowment works is that the money set up in the endowment is permanently invested. The interest earnings from the investments are used to support the program. The endowment money is not touched and is there for the lifetime of the foundation and the program.

So, if a donor wanted to make sure that 10, 20, 30 years in the future the 4-H program had money to support its program, by setting up an endowment the donor would ensure support for 4-H forever.

Depending on the foundation’s policy, endowments can be started with $10,000; others might require a larger initial investment. Ultimately the endowment can grow with more donations people make to it.

The Michigan 4-H Foundation is currently in a match campaign to help build county 4-H program endowments. With support from the Herbert H. and Grace A. Dow Foundation, the Rollin B. Gerstacker Foundation and individual Michigan 4-H family leadership donors, donations made to create or to support existing county endowments will be matched by  a ratio of 1-to-1, doubling the donor’s impact. To learn more about this campaign, visit the Michigan 4-H Foundation webstie.

To learn more about how you can make a difference or impact to your county 4-H program contact your local MSU Extension office.

This article was published by Michigan State University Extension. For more information, visit https://extension.msu.edu. To have a digest of information delivered straight to your email inbox, visit https://extension.msu.edu/newsletters. To contact an expert in your area, visit https://extension.msu.edu/experts, or call 888-MSUE4MI (888-678-3464).

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