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Hi Judy! Always nice to hear from you.

So nice to hear you made your way to Berea. I'm not involved on the endowment board or anything like that -- but they've still managed to do a nice job managing the endowment. :-)

Berea's endowment was discussed in a recent article, as a matter of fact:

How does a president and his administration maintain financial health, top-notch faculty and modern facilities when no student is charged tuition for a four-year education estimated to be worth around $100,000 or more?

Roelofs is an avid fundraiser, but the heart of the solution dates back to the 1920s, when Berea’s board decided all unrestricted bequests would be added to the endowment. Those gifts, which total about $500 million, have grown—with help from the long-term success of the stock market (despite recessions and depressions)—to $1.2 billion.

That amount puts Berea in the Top 100 schools with the largest endowments, close to institutions like Middlebury, Tulane and University of Kentucky, according to the National Center for Education Statistics.

Each year, Berea spends about $55 million of the endowment, which has been invested in various asset classes that are managed actively and passively.

“We are highly dependent on America’s economic success,” Roelofs says. “The fact that the financial markets have averaged 8 or 9 percent gains over a century means you can take out 4 to 5 percent every year, and still keep up with inflation and the thing grows all by itself.”
- https://www.universitybusiness.com/article/college-president...

Unfortunately, this philosophy of managing an endowment in a Foolish manner over the long term -- and using the endowment as a primary income source (rather than relying on raising student tuition fees) -- remains a big exception and isn't the norm. For now, Berea is a clear outlier with its endowment management, but hopefully other institutions will follow suit in the years ahead.

Anyway, it's bittersweet to depart Supernova, but it's been a lot of fun getting Hidden Gems Canada off the ground. Thanks for stopping by here!

Foolishly,
David K
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