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Vanderbilt’s Endowment: Frequently Asked Questions

What is the endowment? The role of Vanderbilt’s endowment is to provide a permanent source of  support for the university’s students, faculty and programs. While current- use gifts support the university’s immediate needs, the endowment ensures long-term sustainability.

Vanderbilt’s $10.9 billion endowment includes more than 3,000 individual  funds with unique restrictions and designations. As with a mutual fund, these assets are pooled and invested collectively. When donors make endowed gifts, shares are purchased in the university’s endowed pool. The value of the shares reflects investment returns after the annual endowment payout. 


Who manages Vanderbilt’s endowment? The university’s Office of Investments manages the endowment under the  direction of the Vanderbilt University Board of Trust Investment Committee.  Vanderbilt maintains a highly diversified investment portfolio designed to  mitigate downturns in any one sector of the economy. The Board of Trust also periodically reviews the endowment’s payout rate to ensure that the university’s current needs are met while also safeguarding the endowment’s future.

What does Vanderbilt's endowment support? The endowment provides a permanent source of support to advance the university’s mission of teaching, research and service. See the Endowment by Use chart on the left for more information.

Why does Vanderbilt devote so much of its endowment to scholarships and financial aid? In the academic year 2020–21, more than 64 percent of undergraduate students and 
more than 86 percent of graduate and professional students received financial assistance. This is a result of our generous endowment donors’ intentions to support scholarships, allowing Vanderbilt to recruit increasingly talented and diverse students. The university launched Opportunity Vanderbilt in 2008, its bold initiative to replace all undergraduate need-based student loans with grants and scholarships. Scholarship support is a top priority for all undergraduate, graduate and professional schools.

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How did Vanderbilt’s endowment grow this year?

During fiscal year 2021, Vanderbilt’s endowment portfolio grew to $10.9 billion.

This growth is due to a set of factors including university investment in the endowment and the addition of new endowed gifts which allowed Vanderbilt to make more than $348 million in distributions.

The global capital market environment was very strong. Global equity markets gained 39%, with significant gains across U.S. large caps (up 41%), U.S. small caps (up 62%), non-U.S. developed markets (up 34%), and emerging markets (up 41%). U.S. bond markets stalled (flat) as long-term U.S. Treasury yields rose but this was generally offset by a tightening of credit spreads. Commodity prices surged (up 57%), and the value of the U.S. dollar declined modestly.


What is the payout? A portion of the endowment’s value is distributed monthly to support the donor-designated purpose such as scholarship, faculty or program support. This distribution is known as the payout. Currently, the payout rate is 5 percent of the average per unit market value for the prior three calendar years. In fiscal year 2021, the endowment paid out more than $348 million.

What percentage of Vanderbilt's annual budget does the endowment fund? In fiscal year 2021, endowment distributions comprised 23 percent of the university’s operating budget. The remaining 77 percent came from other sources such as grants and contracts, student tuition and fees, and current-use philanthropy. 

Can I create an endowment through my estate? Absolutely! The vast majority of testamentary gifts are directed for endowed purposes. Such gifts can become a donor’s legacy at the university, benefiting students, faculty, programs, or other special interests. To learn more about how you can leave a lasting legacy at Vanderbilt, visit vanderbilt.giftplans.org.