Mediaon October 18th, 2010Comments Off on Endowment

When you include Freestore-Foodbank, Inc. in your will/trust or as a beneficiary of a retirement plan or life insurance policy, Freestore Foodbank will invest the funds in the Freestore Foodbank Endowment with other previous gifts. A team of investment professionals manages the entire endowment. Each year, Freestore Foodbank receives a distribution of approximately 5% of the value of the fund. If the endowment earns an average of 8%, the additional 3% remains in the fund; thus your original gift to Freestore Foodbank will increase over time.

The chart on the left illustrates the growth of the annual distributions to Freestore Foodbank of an endowment gift under these assumptions. The 3% net growth in the fund each year means the following year there is a greater amount available to Freestore Foodbank. Looking at the chart, you can see that in the tenth year the fund has grown to the point where it is able to provide $1,361 to Freestore Foodbank. Each year it will continue to grow. In year 50 it will be able to provide $3,799 dollars to Freestore Foodbank.

All told, over the fifty years we have charted, your endowment gift of $20,000 will have distributed a total of $108,367 in annual distributions to Freestore Foodbank and have grown to almost $76,000, continuing to provide needed support. Of course, this is based on the assumptions we outlined in the opening paragraph; that the fund grows at 8% each year and pays out 5% to Freestore Foodbank leaving 3% additional in the fund each year.

Your original gift is never depleted; it provides annual support each year into the future.

The chart on the right illustrates how a gift of $20,000 to the Freestore Foodbank Endowment will grow, providing greater annual distributions to Freestore Foodbank. The illustration assumes the same average investment rate of return of 8%, which is not a guarantee, and annual distribution to Freestore Foodbank of approximately 5% that we used above.

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