Q: I want to give K-State enough money to cover the expense of an out-of-state scholarship. What would I need to give?
A: Currently, an out-of-state scholarship costs the K-State Athletics Department approximately $20,000/year. The KSU Foundation’s current spending policy states that K-State spends four (4) percent of its endowment each year. To calculate the amount needed to perpetuate the gift — even after your lifetime — divide the annual gift amount ($20,000) by the amount called for in the spending policy (4 percent), and you will get $500,000. So, by contributing $500,000, you will be contributing a $20,000 annual gift indefinitely.
Q: What happens to my money if the endowment grows more than four percent per year?
A: When the value of the endowment fund grows beyond the scholarship amount of four percent, so does the income. For example, assuming the above $500,000 gift example, if the fund shows a net return of ten (10) percent in one year, four (4) percent will be used and the other six (6) percent will be reinvested. By the second year, the value of the fund will be six (6) percent higher, or $530,000, and the “gift” from the fund will be $21,200.
Q: Can I only give cash?
A: There are many ways you may choose to establish an endowment in the Ernie Barrett Athletic Endowment Society. Gifts of cash, stocks and planned gifts such as charitable trusts and bequests are common ways to fund the endowment. Charitable annuities, real estate gifts and life insurance are other forms of giving.
Q: What is the benefit to K-State Athletics to building an endowment?
A: According to Athletic Director, Tim Weiser, “For K-State, an endowment represents the long-term solution to the escalating costs of competing at the highest level by giving us a constant stream of revenue and guaranteeing a source of future funding.” Endowments guarantee a perpetual source of financial support.
Q: Okay, I see the benefits of an endowment, but why does the K-State Athletics Department need an athletic endowment society?
A: By forming an athletic endowment society, the athletics department can promote, educate and encourage fans to contribute to and be part of building the athletic endowment. Also, and just as importantly, the society then serves to recognize and honor those supporters who have contributed to the athletic endowment.
