5 Reasons K-12 Schools Don’t Have An ENDOWMENT 

By Brandon Allen
Executive Director | Fortify Foundation

AI has no doubt taken education by storm! It seems every educational conference / convention has at least one session focused on either uses or misuses. If you haven’t had a chance to play around with AI yet, not only can it be an extremely productive tool, but it can also be a wealth of information.  

With the mindset of sustaining Christian education, I recently asked ChatGPT:
“What are the top 5 reasons k-12 schools do not have an endowment?” 

1. Limited Resources & Funding 
2. Short-term Focus on Operational Needs 
3. Limited Donor Base 
4. Lack of Knowledge & Expertise 
5. Legal & Structural Barriers 

Does this sound about right? Perhaps you can relate to one if not multiple of these reasons as to why your school has not explored the arena of endowment yet.  

What I found most exciting about these reasons is that Fortify Foundation provides the solution to each of these! We have bridged the gap to help every Christian school regardless of your situation start an endowment!  

Let’s break these down a bit…  

1. Limited Resources & Funding 

I’m sure you can relate to this being the most glaringly obvious one that sticks out amongst the five. Regardless of what size your school is or what type of operating reserves you are working with, an endowment typically requires significant capital at the start for it to make sense. Financial institutions and community foundations require a minimum for them to even consider managing an endowment. This minimum is really to ensure the fund can make an impact and that it will cover the administrative fees without eating away at the principal. Fortify Foundation takes a different approach. We use a component fund strategy which allows for the same fee structure regardless of your fund’s starting point. The key is to use what God has entrusted to your care and stewarding it in a way that creates true longevity. When it comes to investing, the phrase often goes, “it takes money to make money” which is definitely the case. BUT we allow every school the opportunity to get started at a rate they couldn’t accomplish on their own.  

2. Short-term Focus on Operational Needs 

We get it. Running a school is not easy and there is always a battle in figuring out the right tuition rates, fundraising a certain amount, paying competitive staff salaries, maintaining facilities, all the while providing an excellent environment for students to excel. Even when we feel a little more breathing room in our budgets, we are often playing catch up from the seasons of drought. I say this often, ‘it’s the immediate challenges of today, that often rob us of a stronger tomorrow.’ There is a couple of things to note here. We typically have 2 buckets of income that we manage:

1. Revenue from operations
2. Donations from fundraising efforts.

It’s often from bucket #2 that we focus from in endowment. It’s great when this manifests itself, and better yet when someone establishes an endowment on our behalf through an end of life or other major gift BUT have you considered bucket #1? On an individual level, we plan our income for retirement to sustain ourselves in the future when we no longer have the ability work. Why not apply the same principle to our institutions? Imagine the impact that it will have in the next decade or two if we steward the resources God has entrusted to us that much more. There will always be immediate needs, but it’s how we choose to manage those that determine the outcome in the future. One thing that I’ve always remembered from Bob Jones Sr. “Never sacrifice the permanent on the altar of the immediate.” Fortify Foundation provides some practical steps that every school can implement to effectively build the endowment size they need to sustain their future.  

3. Limited Donor Base 

Many K-12 schools may not have access to a sufficient number of potential donors who can contribute significant amounts to create an endowment. The donor base may be geographically limited, or the school may not have a robust alumni network or a culture of philanthropy that can support an endowment. While this may be something that needs to be worked on and developed, it doesn’t mean that there aren’t other opportunities out there. Having an endowment fund at Fortify Foundation expands your donor opportunities. As a 501c3 with a mission of sustaining Christian education, it is our aim to find donors on a national scale that have a heart for Christian education as well. We already have donors that have graciously left their assets to benefit our partnered schools. This means expanding your donor base and grant opportunities. Every school that has an endowment fund at Fortify Foundation has already benefited from outside donations to their fund in some way, shape, or form.  

4. Lack of Knowledge & Expertise 

It’s real simple. You are called to be educators and have committed your lives to being excellent in the arena of education. Running endowments is not and should never be your calling. Managing an endowment requires financial expertise to invest an endowment effectively and legally. This is why the majority of endowments are outsourced to provide the best strategies for proper diversification and long-term returns. Additionally, while you may have a business office team managing your books, fund accounting is a different animal. Ask any CPA / auditor and they’d be happy to share their experience. It often takes a lot of extra time and money to manage them properly. This is another avenue that Fortify Foundation covers for all of its partnered schools.  

5. Legal & Structural Barriers 

If you’ve ever helped start a school, you know there is a lot of paperwork and legwork required by attorneys to get things going. Creating an endowment is no different. It requires legal structuring, financial oversight, and compliance with nonprofit regulations. It typically requires a designated committee with a clear crafted investment policy statement, advisor, and varying managers for different investments on the fund. Again, this is not something that the average Christian school can or should get involved in. Fortify Foundation has already crossed these hurdles, so you don’t have to.  

In summary, the absence of an endowment at many K-12 Christian schools is often due to a combination of these factors. But this doesn’t mean that we shouldn’t plan ahead and take advantage of an endowment fund to further sustain our future. Donors will appreciate the foresight in your financial planning by implementing an endowment, but they will also expect a well-structured system. Fortify Foundation exists to help you establish and grow an endowment regardless of your current position. We’d love to connect with you over a brief meeting to show how an endowment can change your financial future! 

As you explore the concept of endowment, we would love to have a conversation with you and your board about how this can create a more sustainable future for your school! Contact us at 803-615-3037 ext. 1 or Click HERE to schedule a call.