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So you want to establish an endowment

Most people think that endowments are established by "old, rich people". I know I did. It was a goal, but something I thought might happen in my old age or eventually carried out through my will, but I was wrong. The information below is specific to the University of Washington through the University of Washington Foundation because this is my experience. If you want to establish your own endowment or an endowment with another Foundation contact them for specifics. I'm sure you'll be just as surprised at the possibilities. Also, don't feel too boxed in by what I'm writing here. I hope this inspires you to have conversations people who can talk to you about the specific details of what you want to do because I know there are a lot of possibilities and I'm learning even more as I meet more people who are are working on their own endowments. Here are some important factors for UW:

  • An endowment with the University of Washington can be established over 5 years.
  • If you work for a company that matches your charity giving, their matching becomes part of your giving.
  • There are multiple levels of endowments and multiple types to match your abilities and interests.
  • You can establish an endowment with a group of people.
  • If you have stock, you can transfer the stock directly to the UW Foundation using the value of the stock. This saves the tax hit of selling your stock then donating.
  • You are donating to a 501c3 non-profit so it's tax deductible.
  • The endowment is funded and can start giving grants as soon at it reaches the endowment amount even if you still have to meet your personal donation amount. So if you can reach that amount in donations, you can start watching your endowment work before you've donated your full pledge.

So let's do some math. Let's say you want to establish a $25,000 endowment.

If you are fortunate enough to work for a company that offers corporate matching of your charitable gifts, it can make a lot of sense to establish an endowment now while you're working instead of while you're retired or through your will. The more your company matches the less your personal total contribution to establish the endowment. Some companies match two or three times what their employees donate and some companies have high matching limits. If you think about it, in the scenario above, we established an endowment for the price of a brand new compact car.

Created By
Michelle Gamboa
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