2025-05-04 Sustainable Giving: Building an Endowment for Lasting Change
Sustainable Giving: Building an Endowment for Lasting Change
Imagine being able to support the causes you care about not just today, but for generations to come. Imagine creating a gift that continues giving year after year, providing steady support to organizations working on the issues closest to your heart. This is the power of endowment giving—a form of philanthropy that builds permanent funds to support ongoing work while preserving the principal for future generations. At the Rissover Foundation, building a robust endowment is central to our mission of ensuring that critical work continues long into the future, regardless of economic conditions or changing funding priorities.
Understanding Endowments
An endowment is a permanent fund where the principal amount is invested and only the investment earnings are used for charitable purposes. This means that a gift to an endowment continues working forever, generating ongoing support for important causes while preserving the original donation for future generations.
Think of an endowment like a tree that produces fruit year after year while continuing to grow stronger. The tree itself (the principal) remains intact and healthy, while the fruit (the investment earnings) provides ongoing nourishment. A $100,000 endowment gift, for example, might generate $4,000-5,000 annually for charitable purposes while the original $100,000 remains invested and growing.
This approach creates sustainability and stability that annual giving alone cannot provide. Organizations with strong endowments can weather economic downturns, plan long-term programs with confidence, and focus on their mission rather than constantly fundraising for basic operations.
Why Endowments Matter
In today’s rapidly changing world, many critical social and environmental challenges require sustained, long-term attention. Climate change won’t be solved in a single year. Educational equity requires consistent effort over decades. Conservation work needs ongoing resources to maintain protected areas and monitor wildlife populations.
Endowments provide the stable funding that makes this long-term work possible. They offer several key advantages:
Predictability: Organizations can count on annual distributions from endowments, making it easier to plan programs and hire staff for multi-year initiatives.
Independence: Endowment income provides a base of support that isn’t subject to changing foundation priorities or government funding cuts.
Growth Potential: Well-managed endowments grow over time, meaning their impact increases even if no additional gifts are made.
Legacy Creation: Endowments allow donors to create lasting legacies that continue their philanthropic impact far beyond their lifetimes.
The Rissover Foundation Endowment Strategy
At the Rissover Foundation, we’re committed to building a substantial endowment that will guarantee ongoing support for the organizations and causes we serve. Our approach recognizes that while immediate needs are urgent, sustainable change requires consistent support over time.
We invest endowment funds carefully, balancing growth potential with prudent risk management. We work with experienced investment advisors who understand both fiduciary responsibility and the mission-driven nature of our work. Our goal is to build an endowment that can provide increasing support for our partner organizations while preserving and growing the principal for future generations.
Our endowment strategy also reflects our values. We consider environmental, social, and governance factors in our investment decisions, ensuring that how we invest aligns with what we support. We avoid investments that conflict with our mission and seek opportunities to generate positive impact through our investment choices as well as our grants.
Types of Endowment Gifts
Endowment giving offers flexibility to match different donors’ circumstances and goals:
Cash Gifts provide immediate endowment funding and can be made in any amount. Even modest gifts become meaningful when pooled with others and invested for the long term.
Planned Gifts through wills, trusts, or beneficiary designations allow people to make larger endowment gifts than might be possible during their lifetimes. These gifts often represent a percentage of someone’s estate rather than a specific dollar amount.
Appreciated Securities can be particularly tax-advantageous for endowment gifts, allowing donors to avoid capital gains taxes while supporting causes they care about.
Life Income Gifts such as charitable remainder trusts provide donors with income during their lifetimes while ultimately creating endowment funds.
Building Your Own Endowment Strategy
Whether you’re an individual donor or represent an organization, endowment giving can be part of an effective philanthropic strategy:
For Individual Donors: Consider how endowment gifts might complement your annual giving. Even if you can’t make large endowment gifts now, including charitable organizations in your estate planning creates future endowment support. Many people find that combining current annual gifts with planned endowment gifts allows them to maximize both immediate and long-term impact.
For Organizations: Building an endowment requires patience and long-term thinking, but it provides crucial stability. Start by identifying donors who might be interested in creating lasting legacies. Develop clear policies about how endowment funds will be managed and used. Consider starting with a small endowment that can grow over time rather than waiting until you can launch with a large fund.
For Families: Family foundations and donor-advised funds can be powerful vehicles for multi-generational giving. They allow families to work together on philanthropy while creating endowment-like benefits through ongoing giving over time.
Stewardship and Accountability
Effective endowment management requires rigorous stewardship and clear accountability to donors and beneficiaries. This includes:
Investment Oversight: Regular monitoring of investment performance and adjustments to ensure that endowment funds are managed prudently while generating appropriate returns.
Spending Policies: Clear guidelines about how much of the endowment earnings will be spent annually and how much will be reinvested to maintain purchasing power over time.
Reporting: Regular communication with donors about endowment performance and the impact their gifts are creating.
Governance: Strong board oversight and professional management to ensure that endowment funds are used effectively and in accordance with donor intent.
The Impact of Endowment Giving
Well-managed endowments create compounding benefits over time. A gift made today continues working year after year, generating resources that support countless future activities and beneficiaries. Over decades, the total impact of an endowment gift often far exceeds the original donation amount.
Consider a $50,000 endowment gift made in 1990. With prudent management and reinvestment, that gift might now be worth $150,000 or more, while having generated hundreds of thousands of dollars in charitable support over the past 35 years. The donor’s single gift has created ongoing impact that will continue indefinitely.
This multiplier effect makes endowment giving particularly powerful for addressing systemic challenges that require sustained attention. Each dollar placed in an endowment becomes many dollars of charitable impact over time.
Addressing Common Concerns
Some people hesitate to make endowment gifts because they want to see immediate impact from their donations. This concern is understandable—there’s satisfaction in knowing that your gift is helping someone right now. However, endowment giving addresses the reality that many problems require long-term solutions.
Others worry about restrictions on endowment gifts or changes in organizational priorities over time. These concerns can be addressed through careful gift structuring that provides appropriate flexibility while preserving donor intent.
Some donors prefer to maintain control over their giving rather than creating permanent commitments. While this approach has benefits, it also means that support for important causes depends entirely on continued donor engagement and circumstances that may change over time.
Tax Benefits of Endowment Giving
Endowment gifts often provide significant tax advantages, particularly for donors with appreciated assets or substantial estates. Charitable deductions for endowment gifts can reduce current income taxes, while planned gifts can reduce estate taxes and provide other benefits.
However, tax benefits should complement rather than drive philanthropic decisions. The most meaningful endowment gifts are those motivated by genuine desire to create lasting positive impact, with tax benefits serving as helpful additional incentives.
A Vision for the Future
Our vision at the Rissover Foundation is of a world where crucial social and environmental work has the stable, long-term funding it needs to succeed. We envision endowments that support education, conservation, health, and community development work regardless of economic cycles or changing political priorities.
This vision requires many people making endowment commitments of various sizes. It requires organizations that manage endowment funds responsibly and use them effectively. It requires a culture that values long-term thinking alongside urgent response to immediate needs.
Getting Started
If you’re interested in exploring endowment giving, start by:
Identifying Your Priorities: What causes or organizations do you want to support for the long term? What problems do you think will require sustained attention over many years?
Learning About Options: Talk with financial advisors, estate planning attorneys, or philanthropic advisors about different ways to structure endowment gifts.
Starting Small: You don’t need to make large endowment gifts immediately. Even modest planned gifts or annual contributions to existing endowments can be meaningful.
Thinking Long-term: Consider how your current giving might evolve to include endowment components that create lasting impact.
Building endowments is ultimately about hope—hope that the work we support today will continue, grow, and succeed in creating a better world for future generations. It’s about taking the long view and making investments in solutions rather than just addressing symptoms. It’s about creating resources that will be available when they’re needed most, providing stability and strength for the ongoing work of building a more just, sustainable, and compassionate world.
Learn More
To learn more about endowment giving and planned philanthropy, visit: