What is an Endowment Fund? Why do we need one?
An endowment fund is a repository for unexpected gifts or unusual gifts or special-purpose gifts. An endowment fund is also a repository for plans and projects that are unexpected or unusual or have a special purpose. However, primarily, an endowment fund is focused on the long-term financial future of the congregation. An endowment fund receives gifts and funds of various types, invests those gifts and funds for long-term growth and distributes income from those investments to current projects in support of the congregation’s mission.

A congregation needs an endowment fund in several circumstances: When they have property or money which should not be spent currently, but should be held for future needs; when they have a special project that needs long-term planning and long-term fund raising; when they develop a vision of a future need that will require significant financial support, beyond what the annual budget can provide.

For our Endowment Fund, we have chosen to use the services of the Lutheran Community Foundation, based in Minneapolis, Minnesota. The Foundation is dedicated to supporting the charitable, religious and educational purposes of Lutheran congregations, institutions and communities, and benefiting society in general. It offers individuals and organizations the opportunity to create permanent charitable funds to benefit the charities and causes representing their diverse interests and concerns. At the Foundation, our endowment fund would be invested for long-term appreciation. Only a part of the income from the fund would be available to be spent each year; the remaining income would stay in the fund to build a buffer against inflation and future market fluctuations.