Whatablessing Gifts Roll Up Church Endowment Fund
Whatablessing Gifts Roll Up Church Endowment Fund
What is a church endowment fund?
A church's endowment fund is an aggregation of money, investments, or property donated by individuals over time and structured to provide an ongoing source of support for ministry. An endowment fund often is held in a separate bank or investment account from other parish resources. There can be restrictions on the ways in which both principal (the original gifts) and earnings from endowments are used. A true endowment requires that the principal be held in perpetuity.
What are the benefits of an endowment fund?
Endowed funds benefit a church in several ways. They often allow a church to grow new or existing ministries that would otherwise strain the congregation's already-limited resources. For example, endowment income may cover needed additional paid personnel in music, youth ministry, or Christian formation not provided for by current pledging levels.
In some churches, a portion of the endowment is used to guarantee care and maintenance of buildings and facilities. Repairs, remodeling, and new construction are often funded through endowment funds.
Endowment funds also can provide a long-term, stable source of support, especially during times of economic uncertainty, and may be used in emergencies to offset temporary shortfalls in pledging. For example, if a major contributor leaves the church, endowments can provide short-term, emergency funds to obviate the need for immediate, drastic reductions.
Don't endowment funds have to be used for special purposes?
There are two kinds of endowment:
An unrestricted endowment is one in which the income may be used for any church purpose without qualification.
A restricted endowment is one in which the income may be used only for the purpose specified when the gift is made.
In some cases, the endowment principal may be used, subject to any restrictions placed on the gift. Such caveats are generally specified by the donor but, in some cases, may be determined by the vestry. Since an endowment is intended to be permanent, the use of principal should be subject to additional restrictions (e.g., requiring the unanimous consent of the vestry for decisions that would entail the intentional erosion of principal).
How does an endowment fund operate?
The endowment should be established with a set of policies that delineate who administers the endowment, how funds should be invested or managed, how distributions from the endowment are determined, what provisions are required for the invasion of principal, and how the endowment may be terminated, should that become necessary.
How does the church obtain endowment funds?
Bequests are by far the most common avenue for obtaining endowment funds. Our Gifts Roll Up Endowment Fund is a special endowment campaign can also generate gifts and pledges for the endowment. It has become increasingly common to combine building and endowment campaigns. Finally, endowment funds may be raised through various planned-giving programs, which offer special tax benefits to the donor.
Are there disadvantages to endowment funds?
There are times when congregations become overly reliant on endowment income such that pledging consequently suffers. Other than in exceptional circumstances, endowment funds should not be used for ongoing, regularly-budgeted ministries. The misuse of endowment funds may indicate a failure on the part of the church's leadership to treat annual pledging as an essential part of Christian formation. There are many steps that a church may take to avoid such problems and maximize the rewards associated with developing and employing endowed funds.
How does Your Congregation get started?
The best way to get started is to click on this link:
http://www.giftsrollup.com/join.php?id=whatablessing
Sign up is Free to get started.
On the sign up link above you can also see a short presentation of our compensation plan
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