Endowments & Scholarships FAQs

What is an endowed scholarship?
Funds are placed into a separate account and invested with professional managers. Each year, the scholarship distribution ranges between 4-5% of the value of the endowment. Based on the historical average return of a balanced portfolio of 8-10%, the endowment grows over time, providing increasing scholarships and a continuing legacy for you.

Why does BBC&S need more endowed scholarships?
Based on higher education best practices, BBC&S should have three times its annual budget in endowments, or about $45 million. We currently have $1.3 million in endowed scholarships, producing roughly $60,000 per year in financial aid. More BBC&S students are financing their education with high debt levels, making it difficult for them to continue their education or enter ministry.

What areas need endowments the most?
Currently, most of our endowments are focused on undergraduates who are pastoral or missions majors. While strengthening these areas, we want to increase endowments for:

• Women and minorities
• Seminary and Graduate School
• Married students
• Specialty degree programs

What is the goal of this campaign?
By May 2013 (the close of our fiscal year), our goal is to increase endowed scholarships under management to $3 million. We also want to secure $3 million in commitments for future endowments through estate plans and people creating planned gifts that will fund an endowment. Once funded, these endowments will initially provide $270,000 in financial assistance.

Who will manage the endowment?
BBC Foundation will oversee the management of the endowment. Professional money managers will be charged with investing the funds.

What are my options?

• You can create an endowment in your name or the name of a loved one. You select the criteria and program of study. The minimum funding is $50,000 which can be accomplished through a series of gifts, an estate gift, or by creating a planned gift that funds the endowment at your passing. Your agreement will also enable you to create an annually funded scholarship to help students immediately.
• You can make a gift or commitment to our Ministry Leaders Endowment. This fund gives the president maximum flexibility to help students who show ministry potential and financial need across the institution. You can make contributions in any amount or make a contribution through your estate plan or planned gift.

How can I fund an endowment?

• Transfer cash or appreciated assets now.
• Pledge cash or assets over a period of three to five years.
• Place BBC&S in your estate plan for the entire portion.
• Create a planned gift with BBC Foundation, leaving the balance to your endowment upon your passing.
• Any combination of the above.

What are some creative funding ideas that can also help me?

• Create a planned gift, benefiting you and students. BBC Foundation offers several charitable trusts and annuities that can help you increase income, decrease taxes, and fund an endowment.
  
  
• Give appreciated assets and avoid capital gains tax. If you have appreciated investments, real estate, or other assets, you can avoid capital gains tax by contributing those instead of cash.
  
  
• Place BBC&S in your estate plan and create a legacy. Name BBC&S in your will or change your beneficiary designation on your life insurance policy or annuity to create a meaningful gift.
  
  
• Donate an estate gift from your IRA or 401(k) and reduce taxes. Estate taxes and income taxes can reduce your IRA or 401(k) by 50%. Charities do not pay these taxes, leading to a tax-smart strategy.
  
  
• Contribute life insurance policies, savings bonds, or annuities to increase your charitable deduction. We can help you experience the advantages of tax-smart giving with gifts other than cash.
  
  
• Purchase a life insurance or annuity policy to receive a tax deduction and maximize your gift. We can work with your financial advisor or help you get a quote on this option.
  
  
• Give from your IRA, if you are over 70 ½, and take advantage of a new tax law. During 2008 and 2009, you may experience significant advantages by giving directly from your IRA.

Whom should I contact if I have questions?

Contact BBC Foundation at 800.451.8668 or info@bbcfoundation.org.