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N The Power of Endowment <br /> Endowment <br /> EUnlike a contribution that is given and spent on an immediate need, a gift to an endowment(or <br /> ° permanent) fund will give many times its original value through time, making it"a gift that keeps <br /> -a giving." Over years the value of an endowment fund will be significant both in dollars granted <br /> a and in fund value. <br /> N <br /> How does an endowment fund work? <br /> In an endowment fund assets are invested to provide a consistent,annual distribution for <br /> charitable purposes while protecting the value of the principal against inflation. Assets are <br /> invested for total return, i.e. income(dividends and interest)plus growth(change in market <br /> w value). <br /> For example,a net"total return"of 8%provides: <br /> VO <br /> 5% for annual charitable distribution and fees, and <br /> 3%reinvested to meet inflation. <br /> Leaving a Legacy <br /> • An endowment fund is also referred to as a permanent fund because it will continue to grow and <br /> grant charitable dollars towards its defined purpose, forever. You'll see in the example below <br /> that a single gift of$10,000,when invested as an endowment, will produce more than 10 times <br /> its original value over its first 50 years. During that time it will have granted out more than <br /> Z $56,000 and will have a fund balance of almost$44,000. That's why an endowment fund is a <br /> 0 wonderful vehicle for donors wishing to leave a legacy to a community, organization or field of <br /> interest they love! <br /> Q <br /> 0 <br /> Z A$10,000 investment into a permanent endowment fund provides the following return to the <br /> D <br /> 0 community: <br /> U- <br /> ZD Year Endowment Fund Annual Distribution For Cumulative Charitable <br /> Q Value Charitable Purposes Distribution <br /> ~ 1 $10,000 $ 500 $ 500 <br /> _Z <br /> Q 10 $13,440 $ 650 $ 5,730 <br /> U) <br /> w 25 $20,940 $1,020 $18,230 <br /> ~ 50 $43,840 $2,130 $56,400 <br />