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October 26, 2020 at 01:41 PM
The endowment size of the 10 wealthiest U.S. universities averaged $20.4 billion at the end of fiscal year 2019, according to a U.S. News report.
In contrast, the average endowment size of 354 ranked universities that provided data to U.S. News in an annual survey was about $1.4 billion at the end of fiscal 2019.
Wealthy institutions may opt to use their endowments — the value of their investments based on donated money and financial assets — in ways that significantly benefit students, according to the report.
Related: How College Endowments Invest for the Future
For example, they may enact need-blind admissions policies, provide generous financial aid, recruit outstanding faculty, fund innovative academic programs or offer unique research opportunities.
At the same time, the endowment size of universities, many of which are nonprofit organizations and typically tax exempt, often raises the hackles of students, parents and politicians who are alarmed about the cost of college.
U.S. News notes that schools often do not tap endowment money each year, arguing that they need to keep their endowments growing for future years and noting restrictions on how certain funds can be used.
The report also points out that a university’s great wealth does not necessarily mean that it provides a better educational experience for students, though some of the richest ones are prestigious schools that are widely regarded as academic powerhouses, and often perform well in the U.S. News best national universities rankings.
Check out the gallery for the 10 U.S. universities with the largest endowments.
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