17 Richest Colleges & Universities in the U.S.

Related: 11 Colleges That Mint Future Billionaires: Forbes

Individual investors aren't the only ones reeling from this year's turbulent financial markets. Some of the nation's largest academic institutions, which rely heavily on returns from their endowment fund investments, are reporting steep declines for fiscal year 2022. Last week, Harvard University reported a decline of 1.8% on its endowment investments, and Columbia a loss of 7.6% in the value of its endowment. But before we panic over the future of our higher-education system, let's take a minute to put those numbers into perspective. According to Nacubo–TIAA's study of U.S. college and university endowments and their affiliated foundations for fiscal year 2021, ended June 30 (the most recent data available for all institutions), the average endowment size reported was $1.1 billion, up by 35% from the 2020 fiscal year. The 2021 fiscal year report reflected responses from 720 institutions representing $821 billion in endowment assets. Endowments' average spending rate was virtually the same as in FY20 at 4.5%. The study noted that endowment revenue was likely a bigger part of FY21 operating budgets because tuition and auxiliary revenue at many schools were down owing to the pandemic. Endowments with upward of $1 billion in assets held 84% of market value in FY21, and new gifting to endowments increased by 15% year over year, according to Nacubo–TIAA. Sixty-five percent of respondents reported at least some level of gifting specifically tagged to support diversity, equity and inclusion initiatives. Endowments benefitted from strong returns across public and private equities and other risk assets in FY21, recording an average return of 30.6% overall, compared with 1.8% the year before. But the study showed that one year of robust returns has limited effect on longer-term annualized returns. Look out 10 years, and the annualized return is 8.5% versus 7.5% for FY20. At 25 years, the returns are higher for FY20 than FY21: 7.7% versus 7.4%. Thus, the startling statistics coming out for fiscal year 2022 will just be a blip on the radar in the long term. Note that the change in market value does not represent the rate of return for the institution's investments. The change in the market value of an endowment from FY20 to FY21 reflects the net effect of withdrawals to fund institutional operations and capital expenses; the payment of endowment management and investment fees; additions from donor gifts and other contributions; and investment gains or losses. See the gallery for the 17 largest endowments in FY21.