Have a pen and several thousand dollars? It is as easy as that in most cases to fund a college scholarship and help some deserving student bridge the gap between aspiration and access.
Most colleges and universities have offices to help would-be benefactors and will send you a gift agreement form to set it up. It can even be done online now, said Christian Vaupel, vice president for university advancement and development at Adelphi University, a private college of 6,400 on Long Island, New York.
The going rate for setting up an endowed scholarship – one whose annual funds are created from the interest on the initial gift – requires at least $10,000, preferably $25,000, which offers about $1,250 a year to a needy student, Vaupel said.
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Charitable contributions to colleges and universities in the United States increased 7.6 percent in 2015, according to the Voluntary Support of Education (VSE) survey, conducted annually by the Council for Aid to Education (CAE). At $40.30 billion, the total is the highest recorded since the inception of the survey in 1957.
The College Board estimates there was $16 billion in private and employer-created grants in 2015, but there are no statistics on how much is given annually by individuals, nor the total amount given to date, said Amy Weinstein, executive director of the National Scholarship Providers Association, which tracks this information. “We’ve been trying to get this data for a long time,” she said. “It’s hard because it’s private. We know that it's substantial."
Donors create scholarships for a wide range of reasons, said Michael Kiser, vice president of marketing and communications at the Council for Advancement and Support of Education (CASE).
“You want to see what’s a good fit,” Kiser said. “It’s worth thinking about beforehand, so zero in on what you want to accomplish.”
Many are created to honor loved ones. Last year, John Egan, editor-in-chief of LawnStarter, created a $30,000 scholarship fund at the University of Kansas journalism school in memory of his mother, who died in August 2015. The first scholarship was awarded in April 2016.
"It was so fulfilling to meet the recipient and know that the scholarship awarded to her this year will be one of many bearing my mom's name,” said Egan.
Rodney Alsup and his wife created two scholarships through the development office at Eastern Kentucky University to honor the memory of their parents. The school provided a draft document and then helped them modify it.
“Neither of my parents had a high school education, and growing up, they constantly stressed that we needed to get an education," Alsup said.
Some larger gifts have broader appeals. The Weiss family has given the University of Pennsylvania more than 100 scholarships, many benefiting minority students.
Allison Weiss Brady and her sister launched a second generation of giving with an endowed fund of $15,000 some 14 years ago.
Now 45, Weiss Brady and her husband Chip Brady, a business development consultant, recently gave their largest-ever gift, $250,000 to the University of Pennsylvania School of Social Policy & Practice, with preference given to low-income or first-generation college students.
For donors, taxes are the biggest financial consideration.
A scholarship is considered a charitable donation if the fund it goes into is tax-exempt, said Kathy Hettick, president of the National Society of Accountants.
The amount you can deduct from your annual income varies depending on your tax bracket and follows the same rules as any charitable contribution, according to Hettick. "Get proper documentation and get a receipt with their federal identification number. Do your due diligence,” she ca utioned.
But donors often say that tax deductions are not their main consideration. “The tax benefits we receive are an added benefit, but not our main reason for giving," said Weiss Brady.
(Editing by Beth Pinsker and Bill Rigby)