Grand Rapids Community Foundation welcomes inquiries from Kent County nonprofits that are considering starting an endowment fund with us. The information here will help determine if an endowment fund is a good fit for your organization. If you have any questions, please call one of the Community Foundation development professionals at 616.454.1751.
Why a Nonprofit Endowment Fund?
Current government cutbacks emphasize the need for diversified, stable and predictable sources of income. Just as you would with your personal investments, it may be wise to consider a "funding mix" which will provide financial stability for your nonprofit organization or community.
An important part of the mix may be an endowment fund. This permanent pool of assets generates income and is likely to grow over time. Like your personal savings, this permanent fund can provide a source of additional income each year.
Grand Rapids Community Foundation can assist you in setting up your endowment. Classified for tax purposes as a public charity, the Community Foundation's mission is to manage funds permanently endowed by donors for the benefit of specific charitable causes or the general welfare of the greater Kent County area.
The benefits of a Grand Rapids Community Foundation endowment fund include:
- Being invested in a larger pool of assets which can lead to greater growth, greater income and lower investment fees.
- The Community Foundation handles investment management and oversight; all accounting and financial reporting; and an annual audit.
- An annual income disbursement of approximately 4.5 percent of the fair market value of your fund.
- You may choose to reinvest all or part of the income in years when it may not be needed, so your endowment can further grow.
- All gifts to your fund are restricted for your use only. While pooled for investment purposes, your endowment will not be used by the Community Foundation.
- Your endowment fund will receive exposure in the Community Foundation's annual report.
- All gifts to your endowment fund are deductible at the highest levels allowed.
- Your organization may be able to offer donors more sophisticated planned giving devices such as charitable gift annuities.
- You will receive access to planned giving resources designed to assist your development efforts.