A fund that is made up of gifts and bequests that are subject to a requirement that the principal be maintained intact and invested to create a source of income for an organization. Donors may set up an endowment to fund a specific interest; and a nonprofit's governing body may set up an endowment. In any case, an endowment requires that the principal remain intact in perpetuity, or for a defined period of time or until sufficient assets have been accumulated to achieve a designated purpose.
The practice of investing the principal, rather than spending it, creates a perpetual fund. Most of an endowment’s annual earnings are distributed to the designated benefactors or programs. The endowment fund provides a “forever giving” funding source to the mission and operations of Globus Relief. Endowments offer a solid base of funds that will be available now and in the future. They continue forever since only the interest earned is spent, allowing the fund to continue in perpetuity. Donors receive tax benefits in the form of charitable deductions. The advantages of an endowment are many, and the rewards last forever.
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