Future cost of college

A financial endowment is a transfer of money or property donated to an institution, with the stipulation that it be invested, and the principal remain intact. This allows for the donation to have a much greater impact than if it were spent all at once.

College and University Endowments

The total endowment can be over a billion dollars at many of the United States' richest universities. [1] However, each university typically has numerous endowments, each of which are frequently restricted to funding very specific areas of the university. The most common examples are endowed professorships (also known as chairs), and endowed scholarships or fellowships.

At universities, typically 5% of the endowment's assets are spent every year, with any excess earnings reinvested to augment the endowment and to compensate for inflation and recessions in future years. Calculate the future cost of a college education in your time frame, based on
the cost of one year of college today. [2]

Restricted Endowments

Endowment revenue can be restricted by donors in numerous ways. Professorships and endowed scholarship/fellowships are the most common restriction on large donations to an endowment.

Professorship

An endowed professorship (or endowed chair) is a position permanently paid for with the revenue from an endowment fund specifically set up for that purpose. Typically, the position is designated to be in a certain department. The donor is allowed to name the position, which typically takes the format: First-name Last-name professorship of Department-name.