Generous gifts of endowment from alumni, parents, and friends—and careful stewardship of their investments—are a vital component of Saint Mary's financial stability.

What is the endowment?

The endowment is composed of assets that are invested for the long term to support the College's educational purposes. As the cornerstone of the College's financial stability, the endowment provides program support funding that is not dependent upon enrollment, tuition, or annual giving.

The College's endowment consists of approximately 300 individual funds established to support scholarships, professorships, programs, and College priorities. It includes both donor-restricted assets and assets designated by the Board of Trustees to function as endowment.

Donor gifts made to the endowment buy "units" in the College's endowment investment pool, which operates similarly to a mutual fund--the value of units changes quarterly based on investment returns.

How does the College determine how much to spend from its endowment each year?

Endowment spending guidelines are adopted by the Board of Trustees as part of its endowment investment policy. Spending for any year is up to five percent of the average endowment market value from the preceding 12 quarters, plus administrative and management fees. Spending amounts are determined at the end of each calendar year prior to the beginning of the next fiscal year.

The 12 quarters averaging formula helps to balance the quarterly volatility that occurs in financial markets and allows for a more predictable amount of support for the College's annual operating budget. The 5 percent spending limit, in turn, is a prudent amount that stabilizes the need for ongoing support with perpetual preservation of endowed funds.

How does the College invest its funds?

The College invests endowment funds following an asset allocation model which distributes investments over eight major asset categories, including U.S. equities, non-U.S. equities in both developed and emerging markets, private equity, core fixed income, high yield fixed income, cash equivalents, and real assets, including private real estate funds and publicly traded real estate investment trusts.

Actual investments within these categories are made with multiple investment managers upon recommendation from the College's investment consultant, Wilshire Associates, and upon approval of the Investment Committee of the Board of Trustees. College financial staff, Wilshire Associates staff, and the

Is there an optimal size for the College's endowment?

Endowment goals are often expressed as a multiple of an institution's budget. The optimal size for Saint Mary's endowment is three times the size of the current year operating budget of $125 million. At this higher level of endowment, support of the operating budget would grow from four percent to 12 percent of total revenues.

How does the College seek funds to grow its endowment?

The Advancement Office seeks gifts of all kinds and especially encourages endowed gifts for scholarships, professorships, and chairs. Many alumni and friends remember Saint Mary's College in their wills, estates, and other planned giving methods. Unless otherwise specified, estate gifts are generally deposited into the endowment.

Do tuition and fees cover most of the College's expenses?

Tuition and fees cover approximately 90 percent of the College's operating expenses. This high percentage of dependency on student tuition and fees makes the College somewhat vulnerable to downturns in enrollment levels. Tuition and fees pay the on-going expenses of maintaining the College, whereas gifts help the College advance.

What does it take it establish an endowment?

An endowment for scholarships can be established for $50,000. It can be pledged over a period of five years. Other endowment opportunities are also available for professorships, chairs, and programs.


To learn more about the opportunities and rewards of establishing an endowment at Saint Mary's, please contact Carolyn Otis Catanzaro at (925) 631-4914.