Q&A

Q: What is an endowment?

A. An endowment fund is like a permanent savings account. The principal of the original contribution is never spent—only a portion of its earnings is annually allocated for the purpose of the endowment. The remaining amount of the fund’s earned income is reinvested to ensure future financial growth.

 

Q: What is the investment strategy?

A: Endowments are invested with the objective of earning a total net return (interest and dividends plus appreciation in market value, minus inflation) of 6 percent.

 

Q: What are Ridgeview’s endowment goals?

A: Each year, our goal is to provide stable support to the budget from the endowment, and to preserve the long-term value of the endowment in order to maintain support for future generations and their families.

 

Q: What is Ridgeview’s distribution calculation?

A: Historical investment performance will “trigger” the percentage distributed on a year-by-year basis.

Percentage of Fund Above Historical Principal

Endowment Distribution Percentage

103% and Below

0%

104%—110%

4%

111%—125%

5%

126% and Above

6%

 

Q: What is Ridgeview Foundation’s distribution timing?

A: The historical principal and the investment return will be calculated on or about December 31 on a year-by-year basis. Endowment distributions will be based upon the annual calculation. Ridgeview Foundation’s Finance Committee may request receipt of the distribution either annually, semi-annually or quarterly. If the request is semi-annually or quarterly, Ridgeview will receive a proportionate share of the distribution; the remainder will be invested in a money market until such time that it has been fully disbursed.