What is an endowment?

An endowment is a gift arrangement that provides long-term support for hospitals or programs of Advocate Health Care. This is because gifts to endowments are invested, and only a portion of the earnings are made available for spending. Donors may establish endowments for a specific Advocate hospital or program through Advocate Charitable Foundation for a variety of purposes including research, education, operations, and clinical endeavors. Endowment levels begin at a minimum of $25,000.

How is an endowment funded?

Endowments are funded through outright gifts, pledges, donations of securities or other noncash assets as well as through a variety of planned gifts such as bequests, charitable gift annuities, charitable trusts, and beneficiary designations in retirement plans, financial accounts, and insurance policies.

How long does an endowment last?

Most endowment donors want their gifts to provide support in perpetuity. Typically, endowments are established to last forever. This means they are never totally exhausted. But donors can also set up endowments for a specific term, at the end of which they may be exhausted, expended, or transferred to a traditional type endowment.

Who is responsible for endowments at Advocate?

Advocate Charitable Foundation is the philanthropic fiduciary responsible for all donations to all Advocate hospitals and programs, including gifts designated for an endowed fund. The Foundation is responsible for investing endowed funds and distributing income in accordance with donor restrictions as well as with the policies of Advocate Health Care and Advocate Charitable Foundation. The Foundation presently manages more than 79 endowments with a total market value of over $51.5 million.

How much is available to spend on program each year?

Typically, 4% of the average market value of the prior three years is transferred to a related spending fund. Covered program expenses are paid from this fund. Earnings—interest, dividends, and capital gains—in excess of 4% are retained in the endowment and reinvested. In this way, the endowment can grow. The 4% transferred is sometimes called “proxy investment income.” The percentage transferred is determined by the Foundation’s board of directors.

Why fund an endowment at Advocate Charitable Foundation?

Like blocks of granite, endowment funds last and last. Generations from now, hospital leadership and staff—and the people they serve—will benefit from your foresight and generosity. In a sense, your endowment gift etches your name in stone and conveys your values for years to come.

Unlike annual funds, which are used in the short term, endowment funds are held forever. The Foundation invests endowment funds for long-term stability and growth and each year makes a portion of any earnings available to support the purposes of the endowment.

Endowments create stable funding sources for Advocate hospitals and programs. Often the expression of donor interests, experiences, and passions, endowments can be transformational in nature. The funds provide a baseline of support and help us look into the future with greater confidence. They also inspire others to become involved in supporting our health care mission.

How to establish an endowment

Advocate Charitable Foundation is the fiduciary agent for endowments supporting the hospitals and programs of Advocate Health Care. The minimum amount necessary to create an endowment is $25,000. It may be given in a lump sum or over a period of time. You can also fund an endowment through a bequest or life-income gifts, like a charitable trust or charitable gift annuity. An endowment can bear your name, as the donor who established it, or the name of someone else you may wish to honor, such as a family member, friend, or caregiver. By establishing an endowment, you also provide a new giving opportunity for those who share your passion for the mission of the endowment. We can assist you in considering whether this type of gift is a satisfying way for you to fulfill your philanthropic intentions.

For more information:

For more information about endowments please contact Susan Mongillo at 630.929.6940 or at susan.mongillo@advocatehealth.com. Also visit: www.advocategiving.org


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