Like all gifts that benefit the Texas Tech University System, endowment gifts empower students and faculty across our universities. Designed to make a difference in perpetuity, these special gifts are powerful because they provide lasting support.
Endowments ensure the promise of higher education remains attainable for all students. They fund research breakthroughs that spur discovery and drive our economy. They support world-class faculty and critical programs. They reflect your giving priorities and make a permanent difference at our universities.
Your gift to establish an endowment is an investment in the future of the Texas Tech University System — one that makes an enduring difference for students and faculty and delivers on our promise that from here, it’s possible.
Why University Endowments Matter
The foundation of growth and lasting impact for any university is the generous philanthropic support of its donors. Considered a measure of a university’s long-term strength, endowments are essential to how our universities achieve their missions.
The Texas Tech University System endowment includes thousands of donor-created funds that are invested for the benefit of the Texas Tech University System and its universities. Endowments may be designed to generally benefit a university or restricted to support a specific purpose selected by the donor.
For more than two decades, the combined value of the endowment has grown to exceed $1.3 billion, driven by donor generosity and a balanced, long-term investment strategy.
Endowments impact every aspect of our universities. Most endowment gifts directly support students and faculty through scholarships or endowed professorships and chairs. However, many support a wide range of academic programs, research, museums, facilities and a variety of other activities.
Our Approach to Investment
Endowments function like a mutual fund that benefits our universities. These gifts are invested in the Texas Tech University System’s Long-Term Investment Fund (LTIF), which prioritizes long-term growth to provide reliable funding over time.
Guided by the Uniform Prudent Management of Institutional Funds Act, the Texas Tech University System Board of Regents takes a long-term view of investment performance across a diverse portfolio of assets. The Texas Tech University System endowment has met its target distribution rate of 4.5% every year since the LTIF was created in 1996. Over time, the value of our donors’ endowment funds are expected to grow.
The Board of Regents is responsible for the oversight and management of the LTIF, and thus recognizes its fiduciary and legal responsibility to comply with the terms of donor-restricted funds and ensure those funds are managed and reported according to state law.
To facilitate long-term growth of the endowment, the Board has established an investment office and delegated day-to-day management of the LTIF to the Chief Investment Officer, as defined in the system’s investment policies. Additionally, the Board has authorized an LTIF management fee to support the investment management activities of the Office of Investments and the fundraising activities of Institutional Advancement.
How Endowments are Used
Every year, part of each endowment fund is spent to support the donor-directed purpose of the endowment. The rest of the fund is reinvested to ensure the growth of the endowment in perpetuity.
Endowment gifts are unique because the total amount of the gift is invested. Each year, 4.5% of the 12-quarter rolling average of the endowment’s value is distributed to benefit our universities. Regardless of the endowment’s investment return, the distribution rate remains constant each year to ensure consistent funds are available to our universities.
Choose Your Impact
When you create an endowment, you decide how your investment will support our universities. While endowment gifts support many aspects of university life, these are the most common:
- Scholarships and Fellowships
Make a difference in students’ lives and expand access to higher education. Scholarships support undergraduate students, while fellowships support graduate students. Tailor your gift based on student achievement, financial need or other selection factors.
Recognize faculty achievement and recruit world-class scholars to our universities. Professorships supplement faculty salaries and provide funds to support research and creative scholarship.
- Endowed Chairs
Honor distinguished faculty with an endowment gift to support exceptional achievement or leadership. Endowed chairs support our most innovative scholars or leaders of academic departments.
- Academic Support
Empower specific academic pursuits. Support research and innovation, enable students to study abroad or fund career-launching internships with an academic support endowment.
An Example of How Endowments Work
Establishing an endowment creates a partnership between yourself and the Texas Tech Foundation that benefits students and faculty across generations.
- Working with a development professional, you make a gift to the Texas Tech Foundation to create a scholarship endowment.
- Professional fund managers invest the gift in the Long-Term Investment Fund with other endowment assets.
- Investment earnings increase the endowment’s value.
- Each quarter, a 0.7% management fee is assessed on the 12-quarter rolling average of the endowment. This supports the endowment-building activities of the Office of Investments and Institutional Advancement.
- Each quarter, 4.5% of the 12-quarter rolling average of the endowment is distributed to the university and deposited into a spendable account.
- The university awards a scholarship to a student selected according to scholarship criteria you indicated.
This cycle continues year after year, generating investment income to be used for scholarships for decades to come.