Endowment Gifts and Why They Matter
Contributed by the Endowment Committee
What is an endowment?
An endowment is a pot of donated money - from multiple donors - that is invested to create a reliable stream of annual income for a charitable purpose. For nearly all private foundations, endowed funds are the primary sources of their giving. That is not the case for Impact Austin; membership fees fund our our giving (grants). But, in Impact Austin's case, the endowment can provide a stream of income to support ordinary expenses or even special projects.
Impact Austin created the Rebecca Warren Powers Endowment for Impact Austin in 2016. The endowment was not created by our founder, but named in her honor, and Rebecca requested permission to make the endowment's first gift. The endowment was established with the Austin Community Foundation (ACF), which manages endowments for over 70 local nonprofits and individual donors. ACF is highly respected in our community and it provides access to world-class investment service and support focused on philanthropy.
Why do endowment gifts matter?
Endowments are forever - A permanent endowment is an invested pool of money that provides a reliable source of income over time and in perpetuity. Endowments don't go away.
Investment in future success - Contributions demonstrate an investment in Impact Austin's sustainability. With your endowment gift, you're signaling that you expect Impact Austin to be here indefinitely.
Professionally-managed funds - ACF professional staff are dedicated and experienced experts, locally committed to making the most of our donated funds. The stewardship of assets ensures that Impact Austin's goals are met now and into the future.
Purchasing power - Donated funds are invested for the long-term. The principal will be retained, allowing it to grow over time. Your gift to the endowment never stops giving back.
A reliable source of income - Earnings and income from the endowment guarantee ongoing support for Impact Austin. This is essential for future planning, budgeting, and operations.
Community collaboration - The endowment cements a lasting relationship between Impact Austin and the Austin Community Foundation.
Enhanced stability and prestige - The endowment increases Impact Austin's credibility in the eyes of new members, donors, and Community Partners. It sends the message that we're planning for long-term stability, fiscal responsibility, and fiscal viability.
Tax benefits - ACF is a public charity, and donations to it qualify for the maximum available deduction for charitable contributions in the year when the gift is made.
Flexibility for Impact Austin - Endowments offer options that boards can use to meet new challenges and opportunities. The endowment offers budget stability, financial flexibility, and self-sustaining income streams.
Donor options - Endowments offer options for Impact Austin members and friends to contribute and build long-term strength, in addition to their regular gifts that support today's immediate needs. A donor might consider annual gifts or even planned gifts that mature in the future; both will benefit a growing endowment. While large gifts are appreciated, smaller contributions spaced annually also contribute in a meaningful way. Finally, ACF can accept a range of non-cash gifts to benefit Impact Austin's endowment.
A future post will discuss the various ways to contribute to the Impact Austin endowment.
All donations are appreciated, and small donations add up meaningfully over time.