Most gifts are meant for two types of accounts:
- Endowment (or long-term accounts)
- Are designated by fund numbers beginning with “32.”
- These gifts are invested to provide long-term funding for the University and are managed to grow the principal and provide spendable income.
- Expendable (or current accounts)
- Are designated by fund numbers beginning with “12.”
- These accounts provide a spendable pool of dollars and are managed similar to a money-market fund – to preserve the principal balance of the original gift, provide liquidity when dollars are needed and pay a competitive short-term interest rate.
Some gifts are also deposited into a life estates portfolio, which represents gifts from estate planning vehicles, such as charitable remainder trusts or annuity trusts. The gifts provide income to donors throughout their or their beneficiaries’ lifetimes. The Giving Planning department discusses life income gifts with donors before they are received, and a custodian administers and manages the programs.
Do I always look to the expendable “12” account for dollars available to spend?
That depends on the account.
- Some expendable “12” accounts are set up to receive gifts that are moved quarterly into a linked endowment account.
- If dollars are not meant for endowment funds, gifts that will be spent for current needs are deposited into and spent out of the “12” account.
- If there is a linked endowment account, usually you’ll spend money from the endowment “32” account.
How can I spend money from an endowment account? Aren’t they permanent?
Endowment accounts earn income each quarter, and that income is available to spend at any time. The income may also be reinvested or transferred to an expendable fund.
How do I know which fund to use?
- You’ll spend from the “12” account if you have only a “12” account.
- You’ll spend from the “32” account if your “12” account is set up to transfer gifts to the “32” account.
- You can spend from either account if you maintain funds in both your “12” and “32” accounts.
- If you are not sure, contact the donor relations representative who works with your unit.