Applying Donations to Spendable
We are looking into allowing donors for endowed funds to apply some of their donations to the spendable to the fund. Doing this will allow endowed fundholders to be able to grant more beyond their normal spendable. We want to provide donors with more flexibility in their granting. Is anyone currently doing this? How does it work for your foundation? Do many of your donors utilize this option?
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Hi Wanda,
We allow our donors to do this, but mostly donors take advantage of it for scholarships. A lot of our experience has been that the donor wants to make the donation rounded out to the nearest $500.00. We don't necessarily advertise for this, but if a donor asks we typically allow it.
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Our foundation also allows this. As Samantha mentioned, many of those types of donations are toward increasing the amount of that year's scholarship award. I would say we usually have under 5 donors that do this each year. This year, we had a donor give to increase the amount from the unrestricted endowment they established which will be utilized during our competitive grant cycle this month. We've also had a few instances where we've placed donations into Spendable when a new endowment is created. New endowments need to be invested for a minimum of 4 quarters before they generate an award, so donors will give the minimum establishing amount and the extra that is placed into Spendable to begin generating awards during that waiting period. That is a very rare occurance for us.
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